[COLOR="Green"]Mizuho Corporate Bank: dollar may fall below 84.83 yen[/COLOR]
Technical analysts at Mizuho Corporate Bank Ltd. are bearish on USD/JPY. The specialists expect the greenback to fall below the minimal level since July 1995 at 84.83 yen.
According to Mizuho Corporate Bank, dollar is still staying within weekly Ichimoku chart that means that American currency keeps following the downtrend from 2007. The cloud’s baseline is situated this week at 89.94 yen. If US dollar gets down below 90 yen, it may lose much more.
[COLOR="green"]Westpac: euro will reverse at $1.16/20 and begin rising[/COLOR]
Analysts at Westpac Banking Corp. in Wellington claim that the single currency seems to be oversold. According to the specialists, euro entered strong support zone between $1.16 and $1.20 where it may reverse its trend and begin rising.
In addition the European currency’s relative strength index went down yesterday below the level of 30 that means that the pace of its decline was too high and it is very likely to switch upwards.
[COLOR="green"]RBC: euro will fall to $1.15 by the end of 2010[/COLOR]
Strategists at Royal Bank of Canada in Hong Kong expect the single currency to fall to $1.15 by the end of 2010. The forecast is based on the market’s expectations that the Federal Reserve may lift up rates faster than the ECB.
According to Bloomberg survey, ECB won’t conduct any actions at this direction until the second quarter of 2011. At the same time Ben Bernanke says that the Fed will raise its key interest rate from the minimal level before the US reaches full employment or inflation gets higher.
Eisuke Sakakibara, the former Ministry of Finance official, believes that the European currency may decrease by 20% versus the greenback and drop below 100 yen during the next few months. The economist supposes that euro’s decline will resume as investors are still worrying that the situation in Europe will worsen.
[COLOR="green"]BNP Paribas: euro will fall to $1.08 by the end of the year[/COLOR]
Analysts at BNP Paribas believe that the single will keep declining until the end of 2010 even though this process is going to be slower than in the first half of the year.
The specialists set euro’s targets at 1.2200 at the end of the second quarter, 1.1600 in the third quarter and 1.08 at the year’s end.
As for the near-term period, BNP Paribas is also bearish on euro despite the slight rebound that the pair EUR/USD is showing now. The analysts expect euro to decline to $1.1645 under the negative influence of concerns that Greek debt crisis will continue to spread over euro-zone borders affecting Hungary.
[COLOR="green"]AUD/USD: comments[/COLOR]
Australian currency went down from last week’s maximum at 0.8500 and was supported at 0.8080/8100 zone.
Even though Aussie attempted to get higher, it didn’t manage to overcome resistance at 0.8215 area. The pair AUD/USD is trading flat not far from the 11-month minimum at 0.8065. The pair remains trapped between downtrend lines on the upside and May minimums and the 0.8000 psychologically important level on the downside.
If the pair declines, support levels are at 0.8151, 0.8127 and 0.8087. If Aussie goes up, resistance levels are found at 0.8197, 0.8234 and 0.8266.
[COLOR="green"]Estonia will enter euro area[/COLOR]
European finance ministers are for Estonia entering the euro zone without regarding that the country will have to make many efforts in order to restrain the inflation. Estonia that used to be Soviet republic and joined the European Union in 2004 will begin to use the single currency since January 1 2011.
The country’s inflation rate was equal to 2.5% in April and this figure is projected to rise in the coming years as Estonia’s economic growth pace is above euro area’s average. Estonia’s economic output is only 14 billion euro ($17 billion), so it will be the second-smallest economy of the area ahead of Malta.
As a result, the EU demonstrates that the Greek crisis won’t stir the currency union’s enlargement to the east. Yesterday’s endorsement will be reviewed by government leaders at a June 17 summit, with a formal decision by finance ministers on July 13.
[COLOR="green"]Mizuho Corporate Bank: investors improved their attitude to pound[/COLOR]
British currency was rising versus the greenback in the first half of today’s trading day and approached the maximal level against the single currency since November 2008. It was helped by the positive economic data according to which retail spending rose in May. Sales at stores open at least a year added 0.8% from the previous year while they declined by 2.3% in April.
The market was encouraged to expect that the country will be able to deal with budget deficit more successfully than its European neighbors, claim analysts at Mizuho Corporate Bank Ltd. in London.
Today Britain is planning to sell 1.1 billion pounds of inflation-linked bonds maturing in 2027. Prime Minister David Cameron claimed yesterday that the spending cuts shouldn’t be postponed. He also announced that interest payments may reach 70 billion pounds ($101 billion) in five years.
[COLOR="green"]BNY Mellon: pound declined due to Fitch Ratings comments[/COLOR]
British currency was losing to its major counterparts as demand for safer assets grew after Fitch Ratings noted that the country’s facing serious fiscal problems to be solved.
The greenback rebounded versus sterling as Federal Reserve Chairman Ben Bernanke announced that US economic rebound won’t be very rapid.
Currency strategist at Bank of New York Mellon Corp. in London believe that the market was very fast reacting on Fitch’s information that means that it’s extremely sensitive to all developments of the debt issue. According to the specialists, the market’s still dominated by the uncertainty.
[COLOR="green"]EUR/CHF: comments[/COLOR]
The single currency set a new absolute minimum trading versus Swiss franc at 1.3782 ruining its trading channel of the last 2 days. The pair declined from May 31 maximum at 1.4590 to be trading currently at 1.3820 area.
If the pair EUR/CHF declines, support levels will be at 1.3785 (session’s minimum), 1.3760 and 1.3730. If euro goes up, resistance levels will be found at 1.3845 (previous absolute minimum), 1.3910 (session’s maximum) and 1.3940 (June 7 maximum).
[COLOR="green"]On-line analytics from FBS always is available on: http://www.fbs.com/analytics/news_markets [/COLOR]
