Currency Trends for June 29th: EUR/USD hit a 12-month high reaching IQOPTION

Currency Trends for June 29th: EUR/USD 

This trading week has 2 more trading days but one trend is evident, the US Dollar has extended its decline this week, depreciating against almost all its counterparts. The EUR/USD hit a 12-month high reaching 1.14. There is a major fundamental change, the investors are now thinking about tighter monetary policy in Europe, based on the comments from the European Central Bank and Bank of England.

JAPANESE YEN

The Japanese Small Business Confidence reading for June was 49.2 exactly as the forecast, but the Retail Trade reading for the month of May was weaker than expected, both on a monthly and yearly basis indicating slower consumer spending and consumption, being negative for the Japanese economic growth.

The USD/JPY rose a bit from 111.83 to 112.42. And the Japanese Yen was the only currency being depreciated against the US Dollar.

Euro and British Pound

EUR/USD up 0.35% from 1.1292 to 1.1390

GBP/USD up 0.97% from 1.2795 to 1.2973

The reasons were different though. The German Import Price Index reading was lower than the expectation showing lower production costs and inflationary pressures.

But the UK Nationwide House Prices showed a significant increase for the month of June with a reading of 3.1% compared to the forecast of 1.9%. This higher reading in the House Prices reflects a strong UK housing market and inflationary pressures. Bank of England Governor Mark Carney said on Wednesday that the central bank is likely to need to raise interest rates as the British economy comes closer to operating at full capacity. A very important fundamental news, which explains the rally of GBP/USD.

US DOLLAR

The US Advance Goods Trade Balance reading came at -65.9 Billion compared to the estimate of -66.0 Billion, a neutral reading, and US Wholesale Inventories reading was also neutral as it came at 0.3% compared to the estimate of 0.2% for the month of May.

As a day before US consumer confidence showed a large increase, this shows that there is no lagging consumer demand, which is actually supportive and positive for the US Dollar. But the forex market now has another view and US dollar shows a weakness.

Higher oil prices and gold prices can explain why USD/CAD moved significantly lower, -1.21% from 1.3184 to 1.3013.

USD/CHF was a bit down, - 0.07% from 0.9647 to 0.9579

AUD/USD continued rising 0.70% from 0.7577 to 0.7645

The Australian Dollar strength against the US Dollar has continued for a whole week, showing a strong trend, and can be attributed to higher commodities prices.

Economic calendar for Thursday 29th June 2017

There is plenty of economic data today. The Australian New Home Sales for the month of May, German GfK Consumer Confidence Survey, German Consumer Price Index, US Gross Domestic Product and Japanese National Consumer Price Index can all move the forex market especially with any large surprises on their economic readings.

NOTE: This article is not an investment advice. Any references to historical price movements or levels is informational and based on external analysis and we do not warranty that any such movements or levels are likely to reoccur in the future.