About a month ago, referring to the considerable risks for the dollar on FOREX

About a month ago, referring to the considerable risks for the dollar on FOREX

About a month ago, referring to the considerable risks for the dollar on FOREX, we have said, first, that FedRezerv meeting at 18 \ 03 can go to reducing the federal funds rate by another 50 basis points. Approximately one week or one and a half ago, it has gone that could make the Fed softening of monetary policy immediately by 75 basis points, the market is now much speculation on the fact that the Central Bank and the United States could do to reduce the interest rate in March by 1%. Naturally, the dollar under such mood in FOREX had no choice but to pursue a buyout.

Incidentally, with regard to the reasons for such a high probability of further mitigate the growth of monetary policy in the United States, in addition to anything else you want to draw attention to the stock market and the United States, where the major stock indices (S & P500, Dow-Jones, Nasdaq Composite) to renew its close January minima.

Given that the overwhelming majority of American citizens invests its assets in real estate or stocks, it is legitimate that FedRezerv will prevent a vast drop in the national sites. Regarding the employment report Friday from the world's largest economy, it seems to me the negative and neutral-not so much frightening as we try to provide many economists and analysts. At least this indicates that the unemployment rate (Unemployment rate) in the region in February fell to 4.8%, which is quite compensate for the negative Nonfarm payrolls at 63k. The situation will change if the monthly decline in employment during the quarter will be in the order 100k, and jobless claims while closely fit to 400k.

Expected interest rates for 2008 (blue line at 27, 02, red at 07 \ 03)

Still on the subject of interest rates, should also be noted that while all the same speculators for the most part expect reduce rates 18, 03 at 0.75%, and rumours of -1% somewhat exaggerated. If the Fed does decide to bid immediately cut by 1%, the first dollar it can to cause to fall on FOREX, but then speculators may well begin to play that by the next meeting of the Central Bank will take a pause and cease to lower rates, which ultimately could positively impact on the American currency. Another option would be to what is now selling the dollar, and to reduce fakut at 0.75%, in contrast, will begin to repurchase fixing profit.

To some extent the situation in a possible Fed decision next week, as well as the attitude of investors to risk (Carry trade - JPY, CHF) can clarify the March 13 publication of retail sales (Retail sales) for February (0,1% forecast, previous value 0.3%). It is safe to assume that some currency market participants will be given for the negative statistics for the dollar, so the eve of its withdrawal would try to play a demotion to the American currency.

Translating everything for a couple of EUR, USD, in this regard can not be ruled out that course at the beginning of the week will try to approach or update Friday maximums. I would, however, in this case from new purchases declined, given the fact that many of target levels for the euro in record-short time have been achieved that, coupled with perekuplennostyu EUR-USD may lead to the fixation of profits and reduce correctional course. As a key rezistansa on euro-dollar at this level, there are now 1.54, 1.55. Regarding the possible sale of the euro, it is advised to keep in mind, I would not only stop on the warrant, but also about the fact that the trend against the often fraught with negative mat. waiting or more simply put, negative result.

Fundamentally because buyers and sellers in EUR, USD, in my opinion, can be assessed on Tuesday, when Germany will ZEW economic expectations index (ZEW Economic Expectations Index) for March (previous value -39,5). For GBP, USD considerable attention on Monday is to give data on inflation, which fell in the UK day. Height above 2.02 could marked achievement rezistansa 2.04.

Individual attention in the forthcoming% decline in rates in the United States should pay carry trade. Personally, I proceed from the fact that the decline in the federal funds rate at 0.75% -1% can be no cause for the rise of world equity markets that would weaken, in turn, kratkosrochke position in the yen and the franc on FOREX, allowing play to promotions XXX, XXX and JPY, CHF.

In the meantime, it is possible that the USD-JPY will try once again to test 101.50 support, or even try to poydoyti cherished level of 100. A positive development for the Asian currencies should, in the view of analysts who believe that, in last Friday Japanese Finance Minister Fukushiro Nugaka not given any attention Harmful growth rate for exporters yen, noting only that the Government should closely monitor changes in exchange rates . It should be noted that, beginning in 1995, any reduction pair USD, JPY to 100 verbal accompanied by the first, and then the real currency intervention. On the other hand, the problems of the Japanese economy, sooner or later, may be forced to resort to the old Central tools to stimulate economic growth. Overall, we shall follow the news background.