Published On: Fri, Mar 10th, 2017

Midday Market Review


Today, US dollar is trading in both directions against its main competitors. USD continues falling against euro (by 0.40%), today the pair reached 1.0620. It was positively influenced by Mario Draghi’s comments. He stated that the risk of decrease for European economy was significantly lower, deflation risks was insignificant, euro zone GDP for 2017 would increase for 1.7% (the outlook was 1.6 before), and inflation would be 1.7% (the outlook was 1.3 before). ECB is not planning changes to its soft monetary policy. Draghi stated that it will hold the interest rate at the previous low level for a long time. The regulator doesn’t see any need of stimulating the economy more than it is done today.

US dollar strengthened to GBP by 0.14% (to 1.2140). GBP is weakened due to weak January data on industrial output (on a month-to-month basis, this indicator decreased by 0.4%, and on year-to-year basis it grew by 3.2%, but didn’t reach the expected level).

USD is also strengthening (by 0.45%), during the day the price reached 115.50. Market participants are waiting for the USA labor market data for February, which can define FOMC decision regarding the interest rate. The outlook is not optimistic (the indicator decreased from 227K to 185K). The data on new jobs by ADP, often used as a forward-looking indicator, are positive, and unemployment rate is expected to decrease from 4.8% to 4.7%. If these forecasts are true, USD will strengthen significantly.

Metals are still decreasing during the day. The market is waiting for Non-Farm Employment Change data. As a result, gold reached 1194.85 (0.59%), and silver lost 16.80 (decreased to 0.83%). Crude oil is moving sideways today after decreasing during the week and a weak attempt to restore positions. Brent is trading at 52.50, WTI is trading at 49.90.

European and American indices are growing, the market hopes for optimistic February data on US labor market, stimulating FOMC to raise interest rate in March.  FTSE100 increased to 7358.0 (by 0.52%), DAX — to 12065.0 (by 0.52%), and CAC40 was reaching annual maxima during the day at the level of 5017.0 (and increased by 0.50%). DOW index grew to 20938.0 (by 0.36%), and S&P500 — to 2375.0 (by 0.41%).

Forex Analysis

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