EUR/USD (a 4-hour chart)
The other day main Forex market currency remained under pressure once again amid the ZEW Institute negative macroeconomic statistics on the business climate in Germany. The figures went much worse a forecast, showing the minimum values over the past year and a half. And this is not surprising – there is no optimism in the Eurozone, the region is on the deflationary threat verge.
The euro fell against decrease in economic expectations in Germany to 18-month low. The dollar strengthening was contributed by the rising U.S. Treasury yields, which on 10-year securities rose from 2.60% to 2.66%. The ZEW economic expectations index for the euro area interrupted June 4-month decline and rose to 58.4 compared with § § 55.2 in May.
The UK inflation release in May gave a bad surprise to the market participants - CPI index fell to 1.5% year on year, which will act as a deterrent rate hike by the Bank of England. We observed the GBP/USD pair sales against this negative background as at the moment the price reached the level 1.6937.
The positive external conditions helped the USD/JPY to strengthen. The Consumer Price Index in the United States was better than the median forecast which dispelled all the investor’s doubts about the QE-3 program collapse in the face of the U.S. Federal Reserve. The world's leading stock markets responded with a moderate increase on this event which supported the demand for the U.S. dollar against the Japanese rival.