Currency »

6 February Forex daily review

Sergiy Zlyvko
Share on StockTwits
Published on

On Thursday, according to the results of meetings held, the ECB and the Bank of England kept interest rates unchanged at 0.25% and 0.50% respectively. Decisions of central banks were in line with market expectations, so market participants’ attention immediately shifted to the press conference of Mario Draghi.

The EURUSD fell to 1.3490 before the performance of M.Dragi. The data on the volume of industrial orders in Germany pushed on the euro, which unexpectedly fell in December.

After ECB President’s performance EURUSD rate soared from a low of 1.3485 by 130 pips to 1.3620. Positive reaction of traders was caused by a lack in Draghi’s speech the hints about possible easing of monetary policy. M.Dragi was able to convince traders in the absence of deflation and rising consumer confidence. ECB chief said that the new medium-term outlook for price stability will be made next month.

British pound reacts calmly to the decision of the Bank of England, as the central bank did not release accompanying statement to the decision on monetary policy. Minutes of yesterday’s meeting of the regulator will be published on February 19th. During the day GBPUSD closed up amid falling dollar.

Today is the first Friday of the month. This day a report on the U.S. labor market will be published. The December report showed weak data. Instead of 200,000 74,000 jobs were created and experts decline associated with frost. In January in the U.S. the frosts were longer than in December, and if the main reason for the decline of new jobs were the frosts, the index for January will be even worse than in December.

Since 2000, we do not recall that in the United States was such a cold winter, even Niagara Falls has frozen. Waterfall freezing were in 1848, 1912 and 1932. Such frosts America has not seen for a long time. We haven’t payrolls for those years when freezing waterfall and we could not see how the cold affected the labor market. After reviewing the data on NFP in the past few years, we came to the conclusion after a weak indicator the strong goes. Not always, but the trend of jobs reducing was observed only at the beginning of crises. We expect a flat before 13.30 GMT and forecast scenarios are differ depending on the indicator NFP and unemployment.

If the index is above the forecast, the euro will return to yesterday’s lows. If it is less than the forecast or previous value, then the upward movement of the euro will be formed by threes. By Wednesday three or four high may be formed.

British pound reacts calmly to the decision of the Bank of England, as the central bank did not release accompanying statement to the decision on monetary policy. Minutes of yesterday’s meeting of the regulator will be published on February 19th. During the day GBPUSD closed up amid falling dollar and traded at 1.6320. Movement strength should be similar to yesterday’s rise of EURUSD.

Share on StockTwits

What others are reading on Finances

Sorry. No data so far.


Iron FX 1.11156/1.11128 2.8
XM Markets 1.09948/1.09928 2
FxPro 1.10184/1.10171 1.3
FXCM 1.13943/1.13912 3.1