27, May 2014

EUR/USD (a 4-hour chart)

EUR/USD (a 4-hour chart)

Mario Draghi acknowledged the deflation risks, but admitted their possibility only under certain adverse scenarios. Earlier, almost at every press conference Draghi denied such risks, pointing out the positive low inflation aspects. For example, he said that the absence of sharp price fluctuations is a good thing, especially in the absence of a revenue growth.

Speaking at a forum in Portugal ECB, Draghi did not rule out the possibility of starting asset purchases, if inflation is stuck at low levels "for a long time too." Despite the rather vague wording time, the ECB is likely to really start working on the situation with the European version of quantitative easing. It seems that in times of crisis without such a program did not do.

Dollar index DXY basket put on weight 0.16 % on Friday. The bears showed activity in the EUR/USD that was supported by the negative macroeconomic statistics from the Eurozone. IFO Institute reported about the German business climate index reduction in May to 110.4, which is the lowest in the last 4 months. As we noted earlier in our surveys - the structural problems in the European region will lead to a negative trend in the Eurozone economy. It should also be noted that the European monetary knob pulls with solving problems and the situation may be much more pitiable than many investors expect.

GBP/USD was traded in a narrow range in the lack of important macroeconomic news. The USA primary market housing sales has increased the pressure on the British currency. The index rose by 6.4 % in April, after two months of negative trend indicates a recovery in consumer confidence and a positive factor for economic growth.