Daily Market Review — 29/01/2016
The Bank of Japan interest rate decision and US GDP will be the main events today
This morning it was announced The Bank of Japan interest rate decision. Although most analysts do not expect to see any changes to the bank’s current monetary policy, the Japanese regulator has made another step towards easing its monetary policy. At this time, the bank has introduced a tiered system of negative rates. Thus, next month the main interest rate in Japan is at the level of -0.1%. Also, the bank’s management explained its decision by the fact that they intend to achieve the inflation target of 2% for the second half of 2017. Against this background, the Japanese yen lost about 300 points on a broad spectrum of the market. In addition, today the dynamics of the pair can be impacted by US GDP data which is scheduled for 13:30 (GMT).
Resistance: 121.40, 122.02, 122.58
Support: 120.16, 119.58, 118.83
The Russian currency has significantly strengthened against the US dollar on a background of oil’s price recovery. After reaching a peak at more than 84 rubles per unit of US currency, the pair started to rose. Such dynamics is caused, by the closing of long speculative positions after the pair reached new multi-year high. A Tax period also gives some support to Russian ruble. It is worth noting that the Bank of Russia does not interfere in the current situation. However, today the dynamics of the pair will be impacted by Interest Bank of Russia interest rate decision, scheduled for 10:30 (GMT). Most experts do not predict any changes in the monetary policy of the Russian regulator. Meanwhile, the overall prospect for the Russian ruble looks extremely negative, at least in the medium terms.
Resistance: 75.9907, 77.0756, 78.3963
Support: 73.7267, 72.5711, 71.2793
The main stock markets in Europe closed in the red yesterday, due to weak corporate reporting. Also, the investors continue to pay their attention to the results of the Fed meeting. Let us remind, the US regulator left interest rates unchanged at 0.5%, but signaled about increase in the future. Germany inflation data (fall by 0.8% in January), also influenced the market. Publication of UK GDP for the fourth quarter gave some support. The GDP grew by 0.5% qoq and 1.9% yoy, which coincided with the median forecast of experts. Today, the dynamics of trade can be influenced by the publication of US GDP in the preliminary assessment, which is scheduled for 13:30 (GMT).
Resistance: 9937.27, 10116.17, 10279.51
Support: 9740.22, 9527.61, 9260.37
Gold’s price fell by 1% during yesterday’s trading day, due to profit-taking after rising in the previous session. Let us remind, the US Federal Reserve left interest rates unchanged, and it supported gold. The expectations of Fed monetary tightening provided pressure on gold last year. This year, the focus of investors is on terms and the pace of tightening monetary policy. Also, durable goods orders’ data provided some influence on the market. Today’s trend will depend entirely on the publication of US GDP in the 13:30 (GMT).
Resistance: 1122.99, 1132.17, 1146.45
Support: 1112.31, 1102.52, 1094.94