The US dollar is experiencing a difficult period after the macroeconomic reports last week, which strengthened the hypothesis of a slowing US economy. Market participants’ concerns might come true by the GDP report estimated to fall to 1% (from 2.2%). Later in the day, the Federal Funds Rate will be announced together with the FOMC Statement. Investors already lost faith in a June interest rate increase as markets expect the Federal Reserve to adopt a more dovish tone.
The United States currency has been recently weakening and this situation may in fact be a desired one. The CB Consumer Confidence falling to 95.2 points is a proof of the deteriorated business sentiment which perhaps can hold its roots in the highly appreciated American dollar that started to scare investors. Giving the underlying situation, the descending trend for the dollar could find some more resources to continue.
The single European currency is gaining momentum proving the optimism about the Greek case. The situation is animated by the fact that the negotiation team was changed after the failure of the discussions in Riga and the critics that Slovakia brought to the Greek position. The attention has now moved to May as Tsipras announced that he expects a deal with creditors by the 9th of May.
The 1.1000 resistance level for EURUSD is close, and only a temporary correction is staying in the way of a breakout of the round level.
The EURCHF currency pair is finally moving as the SNB hoped. The Euro is rising and the Swiss franc is losing strength. On 24th of April, the Governing Board Chairman Thomas Jordan hinted that there may be future interest rate cuts measures (if necessary) in order to keep the currency stable. Maybe this announcement scared investors for a while and EURCHF is rising easily towards the 1.0500 resistance level.
Because of the falling American dollar, the New Zeeland currency managed to rise in the area of the local maximum at 0.7740. Now, the currency pair is marking a correction, but the coming interest rate decision may help NZDUSD score a new higher high area. On Thursday, the Reserve Bank of New Zealand is expected to leave the interest rate unchanged at 3.5% situation that may help the NZDUSD advance above the 0.7740 zone and probably aiming the 0.7770 high.
Still on Thursday, the BOJ Outlook Report together with the BOJ Press Conference will be delivered. The Japanese yen may the subject of further weakening if BOJ will lower their inflation outlook. Both Japan and China are subject to the stimulating monetary policies, while recently in the Chinese territory has been speculated as a possible QE program.