18, May 2016

Fundamental analysis

EUR/USD (a 4-hour chart)

Tuesday turned out to be full with economic news. The US statistics was the main driver of the day. The States published the Core Consumer Price Index (0,2% that coincided with the forecast) and Industrial Production (0,7% vs. forecasted 0,3%) reports. Williams and Lockhart (the Federal Reserve members) gave their speeches. Williams supported the idea to raise the rates two or three times this year. According to Lockhart they do not plan the negative rates scenario.

The Eurozone just published their positive Trade Balance for March (28.6B vs. forecast 22.5B).

The pound reduced its gains against the dollar, when the inflation in the UK slowed in April for the first time since September 2015. Retail Price Index increased by 0,3% y/y, after growing by 0,5% in March. Traders expected the inflation to remain at 0,5%, but the British inflation has been below the target level of 2% for more than 2 years.

The Japanese Industrial Production sharply accelerated in March (3,8% vs. previous 3,6%). Capacity Utilization increased from -5,4% to 3,2% in March, still these figures could not help the yen.