Little Statistics Will Be This Week

As usual, let us start with the main results of the previous week. It was short, because of the Catholic Easter on the last working day. There was the Good Friday and financial markets in the U.S., the UK, Germany, Australia, New Zealand and some other countries did not work.

So, last Monday, the U.S.Dollar Index has grown significantly due to increase in the U.S. Retail Sales in March by 1.1%. This is the maximum level for the last two and a half years. An additional positive factor was the growth in sales (excluding gasoline) by 1.4%, the highest level of four years. The Retail Sales are about 70% of the U.S. GDP. However, the March data did not lead to any increase in its growth forecasts for the first quarter. It is still expected that the U.S. economy will grow only by half a percent. It cooled the ardor of the market participants. All other days of the week, the U.S.Dollar Index was in a neutral trend. The inflation data for March on Tuesday and the speech by the Fed Chairman, Janet Yellen on Wednesday were neutral and could not move the price anywhere.

There are no especially important macroeconomic data expected from the U.S. this week. Perhaps, you should pay attention to the information on orders for durable goods, which will be released on Thursday at 14:30 CET. In our opinion, it may be the most important news for the upcoming week. Generally, major events can take place only at the end of the month following the end of the next FED meeting on April 29-30. It will be announced about the next stage of the QE policy reduction. More about this will be discussed in the next video review. Now we want to stick your attention to the 3-month reduction in the Currency Volatility index to its lowest level since July 2007. This technical index is calculated by the Deutsche Bank on the basis of the price dynamics for nine major currency pairs. It usually grows after significant decline. This is reflected in a sharp and strong price movement. We do not exclude that such dynamics can be provoked by the Fed. So the current U.S.Dollar Index sideways trend is not likely to last long. It is better to be used for preparing for future transactions making and forming the corresponding sentiment.

There is no particularly meaningful statistics expected from the EZ during the upcoming week. On Wednesday, at 10:00 CET, we will see the business activity index (Manufacturing PMI) for April. Theoretically, it can affect the Euro somehow if it strongly deviates from its neutral forecast. In our opinion, the main driver of the EUR price dynamics for now is the information about the QE launching in the EZ. It slowly ends in the U.S along with gradual, but still objective recovery of the U.S. economy. Europeans want to do the same thing, but the final decision is not made yet. Accordingly, the Euro may be influenced by any statements from the ECB if they appear.

As for other currencies, the week will be more eventful for them. On Wednesday morning, there will be the Inflation data from Australia for the first quarter. Then the BOE will release the last meeting minutes. Further, we will see the Retail Sales for February in Canada. At the end of the day, the Reserve Bank of New Zealand is expected to announce an increase of the discount rate to 3% from 2.75%. Those who like to trade commodity futures we recommend paying a special attention to China's Manufacturing PMI for April. This is the business activity index in the manufacturing sector. It will also be published on Wednesday, early in the morning. We do not expect significant growth that could support futures quotes. China is the world's largest consumer of raw materials and agricultural products. On Thursday morning, we expect the trade balance to be released in Switzerland and the Inflation data coming out in Japan in the evening. In our opinion, the forecast for both indicators is in favor of weakening those currencies. However, the situation with the Japanese Yen is controversial. The further inflation rise is expected in the country. Meanwhile, the Bank of Japan was going to end the emission after the indicator reaches the level of 2%. More about this will be written in our daily overviews.

Well, at the end of the week, on Friday, we expect the Retail Sales in the UK to be announced.