A number of developments took place in the forex market on Monday, following which the AUD/USD pair continued to trade at around 0.7821 levels. The pair touched higher levels at 0.7833 and dropped lower at 0.7802. According to the forex experts, the pair will consolidate its position further, even as the United States economy will remain bullish in the days to come.
On the other hand, the USD/JPY pair is trading at 121.73 levels at present, after having reached higher at 121.75 and declined lower at 121.49 levels. The USD/JPY has consolidated its position in the market, after Yellen announced that the outlook for US economy will remain upbeat, which further supported the Federal Reserve’s intention to hike the rate of interest at a later stage. As far as the USD/JPY is concerned, the pair will experience bullish sentiments in the upcoming week, even as export figures for the month of March on a year on year basis was positive at 8.0 percent as opposed to the expected figure of 6.4 percent. The NZD/USD pair, meanwhile, is trading at around 0.7303, after having recorded higher levels at 0.7325 and dropped lower at 0.7296. The pair has been trading in the negative zone below 0.7420 levels.
The GBP/USD pair, on the other hand, was unable to gain any further post the release of United Kingdom’s positive retail sales figures. The EUR/JPY pair, which was trading in the red zone, all throughout the previous week, is currently trading at 136.90.
Meanwhile, the Yen strengthened its position against a not so strong EUR, after the BOJ resolved to keep the economic policy static even in the month of May. However, both the currencies are trading lower in comparison to the USD. The Pound, meanwhile, moved at a much slow pace, in comparison to the other currencies, even as the Bank of England is likely to follow the same path as the Fed and tighten the rate of interest by 2016.
The week ahead is packed with a number of announcements and developments including, the United States Gross Domestic Production first quarter data, Switzerland/Canada Gross Domestic Production first quarter results, Bank of Canada policy rate and US Durable goods figures.
According to the leading economists, the U.S. Durable goods data for the April month is likely to drop by 0.7 percent as opposed to an expected drop of 0.5 percent. On the other hand, the United States GDP figures, which will be released on Friday, may decrease from 0.2 percent to 0.9 percent. The United Kingdom GDP figures are expected to growth by 0.3 percent on a quarter to quarter basis. Again as far as Bank of Canada’s decision regarding rate of interest in concerned, the bank is unlikely to change the rate of interest. The BOC has also clarified that it is very much satisfied with the existing monetary policy after the manner in which the economy has been performing of late. However, economic experts stated that in case the GDP data, which will be released on Friday, indicates that the country is growing in a sluggish manner then the bank may delay its decision to ease the policy further.
On the other hand, Japan will be releasing a number of figures on Friday. This will typically include the country’s CPI figures for the month of April as well as Tokyo Inflation data for the month of May. The Japanese economists are of the opinion that the country’s monetary policy will remain static, since the inflation hasn’t picked up at all. The Bank of Japan stated that it is now expecting to achieve the target of two percent inflation by 2016 instead of 2015.