EUR/USD, GBP/USD
The main driver of yesterday's growth in European currencies was the euro zone's good trade balance in the November estimate. The foreign trade balance increased from 19 billion euros in October to 22.5 billion euros. Imports increased by 1.6%, and exports by 3.4%. In the evening, a member of the ECB Board of Governors, Ardo Hansson, made a statement that the Central Bank could simultaneously complete the QE program this autumn, tentatively adjusting the monetary policy plan in the spring.
If we accept the conventional version of the consistent inflation of markets by world central banks, then we see the reason and the transfer of the "relay" of the Fed, which can proceed to QE4, to which much about it was also discussed at the time, only in a somewhat concealed form, through a massive external debt. This operation, as usual, will further strengthen the mood of investors to risk and weaken the dollar. It is also worth to note that the growth of the euro continued on Monday, due to the volatile stop-orders being triggered in the ranges of 1.2020/30 (on Friday) and in the range of 1.2210/20 (on Monday).
Today, the release of inflation data in the UK for the previous month could prove to be important. The basic consumer price index is expected to decrease from 2.7% y/y to 2.6% y/y, the total CPI is expected at 3.0% y/y (0.4% m/m) vs. 3.1% y/y from earlier. The retail price index is projected to be unchanged at 3.9% yoy, house prices may fall from 4.5% y/y to 4.2% y/y. On these data, the pound could adjust downwards after three days of growth by three figures. We expect a delay in the range of 1.3740-1.3820.
For the euro, we expect the price to move smoothly towards 1.2365, unless there is a failure to meet expectations for the final estimate of the German CPI for December (forecast to remain unchanged at 0.6% m/m) and Italy's trade balance for November - a forecast of 5.22 billion euros against 4.95 billion in October.
In the US, the index of business activity in the manufacturing sector of New York in January will be released, a forecast of 18.5-18.0 against 18.0 in December. Let not a strong, but will confirm the indicator of sentiment to buy.
USD/JPY
On Monday, the Yen broke through the noise with the technical support of the range at 110.80-111.00. If we correctly argued on the protection level 111.00 of the Central Bank of Japan in late November of last year, it is now difficult to imagine the disappointment. If you leave the yen with the market forces, then the fall can continue towards the 100th figure, where it was in the summer of 2016. It is difficult for the Bank of Japan to resist such a massive pressure on the dollar. On the other hand, we have yet to hear comments from the regulator regarding the current situation and it is too early to draw conclusions. Yesterday's statement by Haruhiko Kuroda about the good growth of the economy is practically irrelevant.
In the current situation from this morning, we saw a fall in the price indices for corporate goods (CGPI) for December by 0.2% and year on year from 3.6% y/y (revised from 3.5% to 3.5%) to 3.1% y/y. Japan's stock market is growing, adding 0.76% and is supporting the yen, which corrects by 40 points. Later on, the index of business activity in the services sector in November was published - growth was 1.1% against the forecast of 0.4%. On the other hand, the debt market is working to lower the yen - yields on Japanese government bonds are falling across the entire range of securities. Five-year state bonds from the opening of the session are reduced in profitability from -0.073% to -0.083%.
After the completion of a correction, we wait for the price in the range of 109.60/90.