19, August 2015

Fundamental analysis

EUR/USD (a 4-hour chart)

The US dollar enjoyed a moderate demand - the dollar index basket (USDX) closed the trade at the mark of 96.83. By the end of the day the pair EUR/USD had decreased amid the Brent oil decrease which in its turn reduced the euro area inflation expectations. The pair GBP/USD had decreased by the end of the day amid the UK and the US bond yields increase. The pair USD/JPY has strengthened after the Japan GDP weak data output. The economic growth fell by 0.4% in the second quarter.

There was important statistics published. The UK consumer price inflation rose up by 0.1% in July compared to 0.0% in June and it was forecasted 0.0%. The United States published the building permits volume report for July at the level of 1.119 M (the previous value was 1.337M; it was forecasted 1.232M).

Investors should pay attention to the fact that the situation with the US federal budget deficit continues to improve year by year. The United States are fully committed to the budget deficit reduction. By the end of the financial year 2014/2015 is one month and a half. Over the past ten months the US budget deficit (seasonally correcting) has been $428 billion from October to July inclusively against $460 billion in the same period last year (-7% y/y). It is a supporting factor for the US dollar.