Fundamental analysis for March 18, 2016

18 March, 2016

The dollar strengthened while waiting for the Fed decisions. However, the dollar sharply turned around and had fallen across the market after the meeting.

As expected, the Fed left the interest rates unchanged, in the range of 0.25% - 0.50%. Still it has plans to make two rate increases instead of four in the current year. The GDP forecast for 2016 was revised downwards to 2.2% from 2.4% previously. Even if the FOMC raises the interest rates only twice this year, the yield differential of USA government bonds shall expand and investors will have no choice but to buy dollars. Moreover, the "risk appetite" increase will put pressure on the euro as a funding currency. The trades on the pair euro/dollar closed with a growth.

The Bank of England meeting results announcement was the key event of Thursday. The UK 10-year government bonds yield declined by 21 basis points since the last meeting of the monetary regulator, indicating a decline in inflation expectations. The BoE kept the interest rates unchanged. The pair pound/dollar strengthened on the Thursday trades.

The market again began taking into account the different direction of the monetary policies of the BoJ and the Fed. One Central Bank softened its monetary policy against a background of low inflationary expectations. On the contrary, the second one plans to increase the tightening, as the core CPI indicator reached the level of 2.3% in annual terms for the first time since May 2012. The pair dollar/yen fell.


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Gold prices bounced off

The spot was struggling to build onto the recovery during the night trades. Buyers lost their steam at 1265 where the pair found some fresh offers....

Golld turned around and reversed

The bullish trend remained intact on Tuesday. The price bounced from the upper limit...

Gold prices remained in a consolidation phase

Sellers led the spot to 1250 the other day but failed to break below the level. The price remained sandwiched between 1250 - 1255...


DAX grew amid a fresh buying interest

European stocks opened in green when markets recovered from Trump’s failure in Congress. Investors focused on Brexit...

Pound reached its monthly high

The pound remained in an upward channel on Tuesday. The price pulled back from its upper limit...

Brent maintained its ask tone

Sellers continued driving the benchmark lower after a brief pause at 50.80 dollars per barrel...


Gold prices remained in green

The bullish market structure remained in place on Thursday...

Gold prices traded in green

The gold recovery stalled around 1235 dollars per ounce on Monday. Buyers did not find any reason to move the price further. The precious metal was slowly declining...

Brent found a solid support after two day decline

Oil prices slightly rose on Friday morning due to the dollar's retreatment. However, Brent further growth was limited on the news that Russian oil production for February did change comparing to January...

  


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