The Fed did not disappoint expectations and announced the resumption of purchases of long-term bonds. In addition, it was announced target levels of inflation and unemployment, the achievement of which may start tightening in monetary policy - the threshold levels were 6.5% for unemployment and 2.5% for inflation. This news plunged the market participants thought that stopped the pressure on the "buck", but the last day of the five-day week marked another surge of optimism and sales of "green." As a result, the dollar fell against the euro and the pound, but rose against the yen, which has also become hostage to the expectations related to the election of a new parliament in Japan. The data on the U.S. economy has usually been noted in different directions and did not change the mood of investors. Industrial output in November grew by 1.1% after -0.7% in October, the index of optimism in the NFIB small business from collapsed to 93.1 to 87.5, the index of economic optimism about the mood of households calculated IBD / TIPP, in December also decreased - there were 45.1 after 48.6 when the expected improvement to 51.6. Wholesale inventories in October rose by 0.6% in the month and 6.6% per year, but the reason was a drop in sales of 1.2% in the month, producer prices fell again in November, now at 0.8% after -0.2% a month earlier. The trade deficit widened to 42.2 billion from 40.3 billion. On this week's session of important economic statistics will not much attention will be paid to the data on the cases in the building in November, waiting to reducing the number of new buildings by 2.4% m / m, after rising by 3.6% m / m increase in permits to 0.8% m / m in November against reduction of -2.7% m / m With a decrease in November, is expected to see sales in the secondary market, -0.2% m / m after a 2.1% m / m last month.Growth is projected to see the November orders for durable goods, 0.9% m / m, after 0.0% m / m previously.Probably the fundamental changes in the spread of the market events U.S. statistics will not, unless, of course, will be observed Surprise results. All the attention will focus on solutions to issues relating to communications related to "budget cliff." Hints at a consensus between the White House and Congress can support the U.S. currency.
Political background of the euro area, which occurred last week, also supported the single currency. In addition to the expectations of easing in the U.S., optimism and the euro came from such news as satisfactory, according to the European officialdom, Greece with its purchase of bonds from private holders, which gives them access to the next tranche of aid, as well as the success of the negotiation process, in which ministers EU Finance agreed to confer the ECB oversight functions, provides for control over the largest banks of the block. The data is not encouraging for the economy, central banks have virtually all the leading countries of the EU lowered its forecast for economic growth this year and next, according to industry data showed eurozone collapse -1.4% m / m and -3.6% y / y -2.3% m / m , -2.8% y / y, and the preliminary PMI for December industries remain at recession, as, in general, and performance of services. Weakness in demand pushes to reduce inflationary pressures across the euro zone, and this in turn increases the risk of lower rates, but the market does not pay attention to such a possibility. But these are generally ephemeral data as "sentiment" index of ZEW, caught in December in an unexpected sharp rise in Germany and the euro area have created a further impulse purchases of the single currency. This week will be published another report on the mood in the business, this time Ifo Institute will publish its indicators. Forecasts expected growth rate in December, after declining in the previous month, which can also be a cause for good cheer. However, preliminary data on consumer confidence in the bloc are expected to decrease, -27.0 after -26.9. With the reduction in projected results of foreign trade in October - a surplus balance is likely to decline to 10.8 billion from 11.3 billion. Looking forward, it seems, the euro may continue to grow in the former "yeast" caused by the Fed's decision, unless of course, you see a new film on the euro area and in the United States delayed a decision on the budget issues.
The British Pound followed the general market sentiment. Weakness news background "islands" left sterling under external influence, and the British also grew against the dollar and the yen. Unpleasant for the "cable" news emanating from the agency S & P's worsening outlook from the UK from stable to negative, upset investors, but not for long. Data on its own economy though they were few in number, but for the most part supported the pound. The balance of the CBI industrial orders in December improved slightly, though remained in the red, RICS report on prices in the housing market have to decline, but at the same time marked the influx of new customers, which is encouraging for the future. Marked by positive labor market - unemployment unexpectedly dropped, vacancy rates rose to nearly two-year highs. This week is loaded with much more economic data in the UK. In the center of attention will be inflation, as signaling the possible changes in sentiment in the Bank of England on monetary policy, and regular evaluation of GDP for the third quarter. Forecasts suggest that inflation in November remained well above the target level of the Bank of England, and the results of GDP will not be revised. This alignment can be considered supporting point for the pound. Under scrutiny will be the indicators point to the likely outcome of the current quarter, such as - the production index in the services sector, retail sales in November, as well as the publication of minutes of the last meeting of the Bank of England. The appearance hints at a possible recession in the 4th quarter, and the probability of further easing in policy BoE may soon return sterling under pressure to the negative sentiment.
The Japanese currency was sold last week against all of the major opponents. The reason for getting rid of the yen were the same expectations of monetary easing in the "Land of the Rising Sun" after the parliamentary elections scheduled for the coming Sunday. Encouraging economic data did not show - Japan's GDP for the third quarter confirmed at -0.9% q / q, the report of the Treasury announced the deteriorating sentiment of large companies, which was confirmed by review of the Bank of Japan "Tankan". Index of economic observers a little older, the index of activity in the service sector declined and the trade balance remained in deficit solid, -450 billion yen. Prices continue to remind of deflation, the value of goods corporations recorded -0.9% y / y, which, however, was slightly better than the previous -1.0% y / y The positive result in October were noted engineering orders, which rose by 2.6% m / m, 1.2% y / y -4.3% m / m, -7.8% y / y. As for attitudes toward the yen this week, they seem to remain negative as reports on the preliminary results of the parliamentary elections in Japan indicate a high probability of a change of government. The Democratic Party of Japan was defeated and the new prime minister of the country can be Abe, stated the intention to mitigate aggressive monetary policy.
Analyst DC Forex4you : Arkady Nagiyev