EUR/USD (a 4-hour chart)
Australian dollar and other major currencies, closely linked with the state of China's economy, rose sharply on Friday after the People's Bank of China said that it was going to abolish control over lending and financial institutions that would allow to set the rates themselves.
"The decision of Central Bank of China on liberalization of interest rates on loans has no direct economic impact, except for a positive signal about the reforms.", - said Sebastian Ghali, a currency strategist at Societe Generale.
News from China violated the calm session in the currency markets. The U.S. dollar weakened mildly against all the major currencies during quiet trading after two weeks full of events.
The Big Twenty summit, which was held in St. Petersburg, discussed a number of issues: the state of the labor market and measures to overcome unemployment as a factor for sustainable growth, banking reform in Europe and European crisis as a whole, adjustment of tax policy in terms of transnational corporations and the fight against offshore companies. A separate item was the policy of quantitative easing. Japan avoided criticism.
Last week, Moody's rose the forecast of the sovereign debt of the United States to "stable" from "negative." The latter was held since mid-2011, from the moment when the United States faced sharp debate over the national debt ceiling. The main argument for increasing the rating was the progressive growth of the U.S. economy in the beginning of this year, and the White House's efforts to reduce public debt.