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NEWS / Forex Forecasts

USDCHF, USDCAD Before the whole series of important events it is necessary to close current positions...

11:24 03/07/2006

So, the market’s participants wait for new drivers. We shall remind that the nearest significant events for investors will be publication of results of Bank of Canada and Bank of Australia Board’s meetings at 14:00 GMT concerning change of interest rates at 22:30 GMT.

 

And then Bank of England, New Zealand Reserve Bank and Bank of Japan will declare their decisions on this question. The market’s players pay special attention to the latter, hoping for the termination of ultra-liberal policy or policy of zero interest rates.

 

Let's remind that last days experts came to conclusion that the termination of policy of high monetary issue does not mean rates rise in Japan. As a result, if JOB finishes intensive money injections in a national economy on Thursday the rate of yen can decrease strongly as market players should pay off a mortgage on already opened yen long positions.

During two last weeks the yen rate grew on expectations of fast increase of a level of interest rates in Japan, however now the given expectations have noticeably decreased. To a certain extent it was promoted by yesterday's statements of Japan Prime Minister Koizumy that the Bank of Japan should act cautiously in a question of change of a monetary policy.

 

Let's also notice that yesterday's data on factory orders index for January in the USA, having been better than the forecasts, supported a dollar exchange rate. We shall remind that value of the indicator was equal to -4.5 % for a month, at the forecast -5.4 % for a month. Besides the previous value was revised from +1.1 % up to +1.6 % for a month.

 

However experts paid attention to some negative moments of the report. So, orders less defense in January were down 3.3 % against December growth of 1.3 %.

Thus decrease in volume of factory orders in the USA was maximal since July, 2000. The main reason of reduction, in opinion of experts, became orders cut for Boeing Co. planes. We shall notice that orders for a commercial air transport were down 68 %in the first month of a current year and orders for the transport equipment were down 31 %.

So, in January Boeing Co. received orders only on 39 liners whereas in December 204 planes were ordered.

And the level of orders less transport increased in January.

 

Demand for durable goods, which service life exceeds three years, was down 9.9 % in January after growth in December on 2.5 %. More than half of total amount of factory orders falls to a share of this production.

Except for a series of meetings of Central Banks the next few days, IAEA decision on Iran adds nervousness to the market. While, expecting the peace problem settlement oil traders do not hurry up with increasing long oil positions therefore, oil quotations continue trading in a range.

Also the market’s participants will wait for statement of the Federal Reserve Head Ben Bernanke at assembly of Association of independent bankers of America in Las Vegas tomorrow.

 

While, before these events, considering their importance for the further development of a situation, we recommend to fix a current profit on pair dollar/franc, closing a position at current levels (1.3030).

New reliable signals will allow renewing opening of positions. It is necessary to be outside of the market.

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