The dollar weakened a little its positions after weak data on fundamental news over the USA, which publication took place yesterday, in the beginning of the American session.

So technically, dollar quotations on the European currencies - on euro and pound sterling designated a local bottom, at a level 1,2480 euros for dollar and 1,8515 pound sterling for dollar.

The dollar was under pressure of first of all rather weak indicators on industrial production of the USA, according to FRS data. Industrial production in September reduced 0,6 %, the weakest data from the beginning of year, in current year falling was observed only by 0,1 % in February. According to FRS, after record growth in June economic rates in industrial sector fall the 4 straight month. Capacity utilization also fell 0.6 % up to 81,9 %.

Decrease in industrial production in the USA in September was more significant than it was predicted. According to forecasts in September industrial production should have decreased 0,1 %, and capacity utilization – up to 82,2 %.

Decrease in inflationary parameter - PPI also put pressure upon the dollar. Producer prices decreased the last month as much as possible since April, 2003 on a background of reduction of energy prices as the report, published by the US Department of Labor, showed. Decrease in PPI by 1,3 % followed growth of 0,1 % in August.

The prices, excepting energy and food, grew 0,6 % the last month, more than it was expected, and maximally since January, 2005, having reflected jump of prices for motor transport after reduction in August.

1,3 % decrease in PPI followed increase of 0,1 % in August, the US Department of Labor informed in Washington. Core index rose 0,6 % the last month, it is maximal since January, 2005, after decrease by 0,4 %.

The core prices for goods, excepting vehicles, were up 0,1 %, Department of Labor informed. Delay of inflation of consumer prices should follow reduction of prices on raw materials from crude oil up to metals before FRS management recognizes easing of price pressure, economists say.

Treasury notes’ yield decreased after these reports showed that delay of rates of economic growth can help to lower rates of inflation.

More moderate rates of production growth together with scale cooling of housing market increase risks of delay of economic rise and development of economy in a stage of stagnation. These cumulative data along with decrease of inflation pressure in industrial sector which inflationary indexes – PPI demonstrated, confirm opinion of some FRS representatives that FOMC members can make a decision to leave FRS rate without changes at forthcoming meeting in the end of current month. And it in turn can increase the bull moods on the dollar.

Technical picture. The dollar downtrend designated the first starting point - the local bottom designating the termination of the first wave of a trend, despite last weak fundamental data over the USA and possible FRS decision to leave a discount rate without changes, the market’s mood is still in favor of the dollar. At overcoming by dollar of levels 1,2480 on euro and 1,8500 on pound sterling a good precondition for development of the third strongest wave of a trend becomes possible, from these levels it can be possible to set postponed shorts. 1 order with the purpose - 1,8375 on pound sterling and 1,2360 on euro, 2 order with the purpose 1,2250 on euro, and 1,8205 on pound sterling.