Market Fundamental Analysis by RoboForex

AUD found support in statistics. Overview for 21.03.2024

The Australian dollar has shifted to an upward trend against the US dollar. The current AUDUSD exchange rate stands at 0.6621.

The Aussie received significant support from the Australian employment market statistics. The number of jobs increased by 116.5 thousand, surpassing the forecasted rise of 40.0 thousand. The unemployment rate in February dropped to 3.7% compared to the expected 4.0%.

Earlier this week, the Reserve Bank of Australia kept the interest rate at 4.35% per annum. It has remained stable for the third consecutive meeting. The current interest rate is the highest in 12 years.

In its commentary, the RBA refrained from signalling further interest rate increases. This shows that the RBA is confident in the inflationary outlook and sees evidence of price cooling.

Additionally, the AUD benefits from the decline in the US dollar.

Fundamental analysis for other instruments can be found in the section "Forex Forecasts and Analysis" on our website.

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Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex bears no responsibility for trading results based on trading recommendations described in these analytical reviews.

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The RoboForex Team

GBP found itself amid bears. Overview for 22.03.2024

The UK pound sterling weakened noticeably against the US dollar. The current GBPUSD exchange rate stands at 1.2643.

As expected, the March BoE meeting ended predictably, with the interest rate kept at 5.25% per annum. The regulator's commentaries were restrained. The BoE indicated that the monetary policy would remain restrictive for as long as necessary to control inflation fully.

The Bank of England's inflation target remains at 2%, which the regulator believes can be achieved by the end of Q2 2024. However, no indication was given as to what the BoE intends to do after that.

It appears that the Bank of England is diverging from the general strategy of other global banks regarding interest rates, which is why the pound crashed.

The GBP exchange rate is under additional pressure from the US dollar, which has strengthened noticeably.

Fundamental analysis for other instruments can be found in the section "Forex Forecasts and Analysis" on our website.

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Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex bears no responsibility for trading results based on trading recommendations described in these analytical reviews.

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The RoboForex Team

GBP has suspended its decline. Overview for 25.03.2024

The UK pound sterling suspended its falling against the US dollar. The current GBPUSD exchange rate stands at 1.2607.

Last week, GBP suffered a lot. It dropped 1% against USD on Thursday and 0.5% more on Friday after the Bank of England left the interest rate without a change. Everything turned out just as expected but the tone of the BoE’s comments remained rather soft. Two policymakers from the monetary committee denounced their previous calls for raising the lending cost.

However, the experience of the Swiss National Bank that suddenly raised the interest rate last week opens similar doors for other regulators.

The UK pound is not expecting much important statistics. Still there are things to take a look at: on Thursday, the UK GBP reports for Q4 2023 will be presented. According to preliminary estimations, the economy might have dropped by 0.2% y/y after rising by 0.3% previously.

Fundamental analysis for other instruments can be found in the section "Forex Forecasts and Analysis" on our website.

Attention!
Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex bears no responsibility for trading results based on trading recommendations described in these analytical reviews.

Sincerely,
The RoboForex Team

AUD is inclined to growth. Overview for 26.03.2024

The Australian dollar has moved into positive territory against the US dollar. The current AUDUSD exchange rate stands at 0.6540.

Consumer sentiment in the Australian economy in March retreated from its 20-month peak as concerns about the economic prospects and household finances have come to the fore. According to Westpac observations, the consumer sentiment index lost 1.8% in March after rising by 6.2% in February. The index reached 84.4 points, indicating that pessimists still outnumber optimistic consumers.

The February data provided hope that consumer discouragement that prevailed for the last two years was finally beginning to dissipate. The March report does not confirm this. At best, the momentum will be slow and leisurely.

Last week, the Reserve Bank of Australia kept the interest rate unchanged at 4.35% per annum. It softened its commentary on the likelihood of future interest rate hikes and described the economic outlook as well-balanced.

Fundamental analysis for other instruments can be found in the section "Forex Forecasts and Analysis" on our website.

Attention!
Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex bears no responsibility for trading results based on trading recommendations described in these analytical reviews.

Sincerely,
The RoboForex Team

JPY is the worst-performing currency of the quarter. Overview for 27.03.2024

The Japanese yen resumed weakening against the US dollar. The current USDJPY exchange rate stands at 151.75.
The latest economic data from the US has cast doubt on whether the Federal Reserve will decide to lower interest rates soon, which pushed the JPY to a 30-year low. The current levels are the ones at which Japan conducted currency interventions in 2022.

The yen is now at its lowest level since the mid-1990s.

This morning, in their commentaries, the Bank of Japan's monetary policymakers and the Ministry of Finance used very similar language to that in 2020, which preceded interventions. While this may not necessarily occur this time, the probability cannot be completely ruled out.

The yen is becoming the worst-performing currency this quarter among those in demand, even after the Bank of Japan abolished the negative interest rate regime. The reason is the huge difference in the cost of borrowing.

Fundamental analysis for other instruments can be found in the section "Forex Forecasts and Analysis" on our website.

Attention!
Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex bears no responsibility for trading results based on trading recommendations described in these analytical reviews.

Sincerely,
The RoboForex Team

EUR continues to lose weight. Overview for 28.03.2024

The primary currency pair is heading downwards on Thursday. The current EURUSD exchange rate stands at 1.0823.

Overall, the market sentiment easily fits into consolidation as the decline does not appear agitated. Investors are conserving energy before new economic statistics from the US are released, particularly before tomorrow's Core PCE report. This is the Federal Reserve's favourite inflation indicator.

The general expectation is that the US Federal Reserve will cut interest rates three times this year, each by 25 basis points.

Simultaneously, the likelihood of an interest rate decrease by the European Central Bank in June is estimated at 81%, compared to a 64% probability for the Fed.

The main market movements are expected today because tomorrow is a public holiday in most Catholic countries for Good Friday.

Fundamental analysis for other instruments can be found in the section "Forex Forecasts and Analysis" on our website.

Attention!
Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex bears no responsibility for trading results based on trading recommendations described in these analytical reviews.

Sincerely,
The RoboForex Team

EUR has dropped even lower. Overview for 29.03.2024

The primary currency pair continued to decline on Friday. The current EURUSD exchange rate stands at 1.0775.

Market activity will be limited today as Catholic countries observe the Good Friday public holiday. However, this is a stock market date, not a federal one, so statistics will still be published, although investors will not utilise them until Monday.

Today's statistics focus on February's US Core PCE report, the leading price index of personal consumption expenditures. The indicator is expected to have risen by 0.3% that month, slightly lower than in January. On a year-to-year basis, Core PCE could remain at the 2.8% level.

Price pressures remain elevated, allowing the Federal Reserve to keep interest rates high. This, among other things, supports the US dollar.

Fundamental analysis for other instruments can be found in the section "Forex Forecasts and Analysis" on our website.

Attention!
Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex bears no responsibility for trading results based on trading recommendations described in these analytical reviews.

Sincerely,
The RoboForex Team

EUR dropped to the mid-February lows. Overview for 02.04.2024

The primary currency pair remains under significant pressure on Tuesday. The current EURUSD exchange rate stands at 1.0730.

US statistics released yesterday triggered a substantial strengthening of the USD. The data included the March ISM Manufacturing PMI. The report showed an increase to 50.3 points from 47.8 points the previous month. Firstly, the indicator surpassed the 50-point threshold that distinguishes between decline and growth. Secondly, it halted a 16-month downtrend.

The components of the new release appeared varied. Manufacturing parameters recovered, and the number of new orders increased. However, employment in the sector remains low, and commodity price pressure persists.

According to CME FedWatch, the market has slightly adjusted its expectations regarding the US Fed’s interest rate cut in June.

Today, the market focus is on the March manufacturing PMI in the eurozone and the February manufacturing order report in the US.

Fundamental analysis for other instruments can be found in the section "Forex Forecasts and Analysis" on our website.

Attention!
Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex bears no responsibility for trading results based on trading recommendations described in these analytical reviews.

Sincerely,
The RoboForex Team

GBP has found support. Overview for 03.04.2024

The UK pound sterling, paired with the US dollar, has entered positive territory. The current GBPUSD exchange rate stands at 1.2579.

Fresh statistics indicate that sentiment within the UK business sector is notably optimistic. The Manufacturing PMI for March rose to 50.3 points from the previous 47.5 points. The fact that the indicator has crossed the psychologically significant threshold of 50 points is undeniably positive.

Mortgage lending volume in February saw an increase to 1.51 million, up from 1.07 million the previous month. Net lending to individuals also expanded noticeably to 2.80 million from 0.69 million earlier.

The primary catalyst lies in the recovery of domestic demand.

British authorities expect that households will be inclined to increase spending this year.

Fundamental analysis for other instruments can be found in the section "Forex Forecasts and Analysis" on our website.

Attention!
Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex bears no responsibility for trading results based on trading recommendations described in these analytical reviews.

Sincerely,
The RoboForex Team

EUR recovered its losses. Overview for 04.04.2024

The primary currency pair is moving upwards on Thursday. The current EURUSD exchange rate stands at 1.0844.

The euro's recovery against the US dollar is due to yesterday's comments from Federal Reserve Chair Jerome Powell regarding future interest rates. In fact, he merely confirmed that the Fed would rely on recent statistics when making interest rate decisions. The market responds positively to this, suggesting stability, and the Fed is gradually preparing for an interest rate cut in June.

Considering this, the US employment market statistics for March, which are due for release on Friday, are critical.

The consensus forecast suggests that the unemployment rate remained at 3.9%, while average wages surged by 4.1% y/y compared to 4.3% previously. The nonfarm payrolls report might show a 205 thousand increase after skyrocketing by 273 thousand in February.

The probability of an interest rate rise in June is currently estimated at 60%.

Fundamental analysis for other instruments can be found in the section "Forex Forecasts and Analysis" on our website.

Attention!
Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex bears no responsibility for trading results based on trading recommendations described in these analytical reviews.

Sincerely,
The RoboForex Team

NZD halted its growth. Overview for 05.04.2024

The New Zealand dollar, paired with the US dollar, has come to a pause. The current NZDUSD exchange rate stands at 0.6006.

The Kiwi dollar has regained a relatively stable position. The market turned in favour of currencies other than the US dollar after Federal Reserve officials once again expressed their doubts about the likelihood of a near-term interest rate cut.

These deliberations will be endless until the Fed makes a final decision and announces it to the market.

Nevertheless, the market consensus forecast for the NZD suggests that the Kiwi will rise this year, following the AUD's trajectory and benefitting from the weakening of the US dollar exchange rate.

Signals from the Reserve Bank of New Zealand are reasonably consistent. It has previously stated that it remains focused on controlling inflation.

Fundamental analysis for other instruments can be found in the section "Forex Forecasts and Analysis" on our website.

Attention!
Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex bears no responsibility for trading results based on trading recommendations described in these analytical reviews.

Sincerely,
The RoboForex Team

AUD managed to rise. Overview for 08.04.2024

The Australian dollar increased against the US dollar on Monday. The current exchange rate for AUDUSD stands at 0.6578.

The Aussie remains in a sideways movement globally. A month ago, AUD was at approximately the same level. An unexpectedly strong US employment report reduced anticipation that the Federal Reserve may initiate a monetary policy easing phase as early as June, allowing currencies other than the USD to stabilise their positions.

Australian statistical data showed that new home loans grew less than forecasted in February. The construction of new homes slowed down, which appeared to impact the bank's lending parameters. The Reserve Bank of Australia's interest rate remains at a twelve-year high of 4.35% per annum. At the last meeting, the RBA left it unchanged for the third consecutive time but refrained from wording suggesting an increase in the rate.

Fundamental analysis for other instruments can be found in the section "Forex Forecasts and Analysis" on our website.

Attention!
Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex bears no responsibility for trading results based on trading recommendations described in these analytical reviews.

Sincerely,
The RoboForex Team

GBP is aiming for growth. Overview for 09.04.2024

The British pound, paired with the US dollar, maintains positive momentum. The current GBPUSD exchange rate stands at 1.2657.

Meanwhile, it is worth noting that GBP gains appear relatively modest as the market still experiences pressure from the trajectory of the US dollar. The chances of an interest rate cut from the Federal Reserve have significantly decreased compared to the levels seen earlier in the year. Initially, investors expected six rate cuts but now only anticipate a maximum of three.

The latest comments from the US Federal Reserve chair, Jerome Powell, indicating that the Fed is in no hurry to make essential decisions, were supported by data on prices and employment. The US economy is clearly in a more stable position than it appeared at the beginning of the year, which is positive news for the US and the US dollar but not for interest rate prospects.

The market has already factored in the Bank of England’s soft stance on interest rates and the declining inflation parameters in the UK. Core inflation in the UK is currently holding steady at 4.5%, significantly higher than the 2% inflation target, ruling out a scenario of rapid interest rate cuts.

Fundamental analysis for other instruments can be found in the section "Forex Forecasts and Analysis" on our website.

Attention!
Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex bears no responsibility for trading results based on trading recommendations described in these analytical reviews.

Sincerely,
The RoboForex Team

JPY is under strong pressure. Overview for 10.04.2024

The Japanese yen remains in a weakened position against the US dollar. The current USDJPY exchange rate stands at 151.80.

Bank of Japan governor Kazuo Ueda finally clarified the Japanese regulator's future actions. The monetary policymaker noted that the BoJ will not directly react to the yen's exchange rate fluctuations. In this way, the Bank of Japan refuted market speculations that a steep decline in the JPY may force it to raise interest rates rapidly.

Ueda stated that the BoJ will not change its monetary policy in response to exchange rate fluctuations. BoJ officials are confident that, while a weak yen will push up import prices, this alone will not lead to an increase in borrowing costs.

However, if the risk of a surge in wages emerges and inflation exceeds the 2% target, the Bank of Japan may need to consider revising its monetary boundaries.

In March, the yen dropped to a 34-year low against the US dollar and remains under significant pressure.

Fundamental analysis for other instruments can be found in the section "Forex Forecasts and Analysis" on our website.

Attention!
Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex bears no responsibility for trading results based on trading recommendations described in these analytical reviews.

Sincerely,
The RoboForex Team

JPY hits new lows. Overview for 11.04.2024

The Japanese yen has dropped even deeper against the US dollar. The current USDJPY exchange rate stands at 152.98.

The yen collapsed under pressure from the US dollar after US treasury bond yields rose. This happened amid the publication of March inflation statistics, which completely inverted market expectations. Now, the market believes that the wide gap between the interest rates of the Bank of Japan and the US Fed will remain in force. This factor has the strongest impact on the JPY exchange rate.

Japanese authorities continue to hint at a possible intervention in currency fluctuations if exchange rate movements become excessive and disorderly, but this has long ceased to impress anyone.

The Japanese Ministry of Finance is perhaps considering the appropriate timing for any action. Yet for now, fiscal authorities continue to reiterate the same message day after day: "We are observing, monitoring, and ready for anything".

The government perfectly realises that factual intervention will only provide a short-term respite for the yen. That is why financial interventions have yet to occur.

Fundamental analysis for other instruments can be found in the section "Forex Forecasts and Analysis" on our website.

Attention!
Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex bears no responsibility for trading results based on trading recommendations described in these analytical reviews.

Sincerely,
The RoboForex Team

EUR surrendered without a fight. Overview for 12.04.2024

The primary currency pair is sliding down on Friday. The current EURUSD exchange rate stands at 1.0682.

The strengthening of the US dollar is associated with low expectations from the US Federal Reserve's interest rate for this year. In January, the market expected six interest rate cuts; in March, it expected three, while today, it only anticipates two. Such forecasts are due to the publication of robust US statistics that increase the inflationary component.

The European Central Bank's meeting concluded yesterday. The interest rates remained unchanged.

In the commentary, the ECB mentioned that it would be appropriate to lower the interest rate if the core inflation dynamics and the strength of monetary policy gave more confidence in the CPI nearing the target levels. The regulator mentions the possibility of easing monetary conditions in its accompanying statement for the first time.

In fact, from December to now, the ECB has gone from firm statements to soft remarks.

Some market participants have already begun anticipating aggressive ECB rate cuts in the upcoming months, but such forecasts are unlikely to be grounded.

Fundamental analysis for other instruments can be found in the section "Forex Forecasts and Analysis" on our website.

Attention!
Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex bears no responsibility for trading results based on trading recommendations described in these analytical reviews.

Sincerely,
The RoboForex Team

EUR continues to decline. Overview for 15.04.2024

The primary currency pair is below the previous level on Monday. The current EURUSD exchange rate stands at 1.0650.

The US dollar strengthened its position for two reasons. The Federal Reserve’s reactions to the US inflation data delayed the expected timing of a rate cut, pushing it back to September, and the Middle East conflict intensified.

Last week, EURUSD experienced the most significant weekly decline since 2022. US inflation figures were unambiguous: prices remain high. This situation made the Federal Reserve hesitant about its forthcoming decisions. Investors immediately shifted the likely date for an interest rate cut in this monetary cycle from June to September. It seems the Federal Reserve only has two rate cuts left for this year. For comparison, back in January, it was expected that there would be six.

The Middle East disputes are escalating to a new level, reducing risk appetite on the stock market and contributing to demand for the safe-haven US dollar.

Combined, all these factors have worked against the EURUSD, pushing the pair to its lowest value since 11 March.

Fundamental analysis for other instruments can be found in the section "Forex Forecasts and Analysis" on our website.

Attention!
Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex bears no responsibility for trading results based on trading recommendations described in these analytical reviews.

Sincerely,
The RoboForex Team

GBP is too weak. Overview for 16.04.2024

The British pound, paired with the US dollar, attempted to recover but without success. The current GBPUSD exchange rate stands at 1.2437.

Yesterday’s release of US retail sales data reduced the pound’s ability to recover from its sharpest decline since June.

The UK will publish statistical data on the employment market on Tuesday and inflation on Wednesday. All these reports will be crucial for the Bank of England, which meticulously selects statistics for analysis. This week could significantly influence the BoE’s policy in the coming months.

Any surprises in the wages report could substantially impact the trajectory of the GBP.

Markets believe August could be when the British regulator decides to reduce the interest rate.

Fundamental analysis for other instruments can be found in the section "Forex Forecasts and Analysis" on our website.

Attention!
Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex bears no responsibility for trading results based on trading recommendations described in these analytical reviews.

Sincerely,
The RoboForex Team

EUR halted. Overview for 17.04.2024

The primary currency pair paused its sell-off on Wednesday. The current EURUSD exchange rate stands at 1.0624.

The market has grown weary of selling, particularly as the five-month lows have been updated repeatedly. Monetary policymakers from the US Federal Reserve and the European Central Bank were quite active yesterday, but the market has already factored in all their comments in the quotes.

Jerome Powell, Chair of the US Federal Reserve, stated yesterday that the regulator hopes to receive more confident data on inflation stabilisation in the future. Investors interpreted his remarks literally, concluding that the Fed is not ready to cut interest rates in June and is shifting forecasts to September.

European Central Bank member Francois Villeroy de Galhau highlighted the ECB's ability to adjust the pace of interest rate cuts if the Middle East conflict has a long-term impact on energy prices. The ECB is expected to make its first interest rate cut after the June meeting. Inflation in the region is confidently heading towards 2%. Market participants expect to see three rate cuts by the end of 2024.

While there is no contradiction between monetary policies, the market's reaction to Powell's remarks is evident: investors are adjusting their strategies in response to the absence of decisive action from the Fed on a global scale.

Fundamental analysis for other instruments can be found in the section "Forex Forecasts and Analysis" on our website.

Attention!
Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex bears no responsibility for trading results based on trading recommendations described in these analytical reviews.

Sincerely,
The RoboForex Team

EUR is recovering. Overview for 18.04.2024

The primary currency pair is rebounding on Thursday. The current EURUSD exchange rate stands at 1.0674.

The US dollar lost some strength as the market grew tired of worrying about shifting expectations of interest rate cuts from the Federal Reserve. Investors already know that the Federal Reserve's current monetary policy settings will remain restrictive for some time. It is high time the EURUSD normalised.

The US dollar has recently surged as the released macroeconomic statistics confirmed the robust performance of the US economy, reducing the likelihood of an interest rate reduction in June. Additionally, the US dollar has been in demand as a safe-haven asset while the Middle East is experiencing heightened tensions.

Risk appetite is now recovering, and this is becoming more evident with the agreement among the US, Japan, and South Korea to consult on currency market issues.

Today, the market awaits weekly data on jobless claims in the US and the March report on existing home sales.

Fundamental analysis for other instruments can be found in the section "Forex Forecasts and Analysis" on our website.

Attention!
Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex bears no responsibility for trading results based on trading recommendations described in these analytical reviews.

Sincerely,
The RoboForex Team