• American focus: the dollar fell markedly against most major currencies

Market news

3 June 2015

American focus: the dollar fell markedly against most major currencies

The euro rose substantially against the US dollar came close to the level of $ 1.13. Despite the growing uncertainty around Greece and the fall of the chances of reaching an agreement this week, interest in buying back the euro. The fall in the bond market in Germany led to increased yields on 10-year securities to new yearly highs, which supported the euro rally. Today, some media reported, citing sources, that the international creditors at a meeting in Berlin reached a consensus on the parameters of proposals to the government of Greece. Earlier, a source in official circles of Greece said that the European Central Bank increased the limit of the amount of funding Greek banks in the framework of emergency provision of liquidity (ELA) by 500 million euros. The total amount of funding for Greece ELA is now 80.7 billion euros, the source said. Meanwhile, the Ministry of Finance of Germany Schaeuble said that the talks between Greece and its European partners can be delayed for a longer period than expected. He once again showed pessimism, called "unjustified" any expression of optimism on this issue.

A little influenced by the statements of the ECB Draghi. During the press conference, Draghi said that inflation will accelerate later this year and will continue to rise in 2016 and 2017. Inflation forecasts for 2015 revised to increase as expected, the ECB revised its inflation forecasts for the current year upwards, while the assessment for 2016 and 2017. remained unchanged. Now the ECB expects inflation in 2015 will increase by 0.3% against the March estimate of 0%. In 2016 and 2017 inflation is expected to rise by 1.5% and 1.8%, respectively. Draghi added that the QE program will support inflation expectations and domestic demand will remain the main driver of the economic recovery. Meanwhile, the head of the ECB said that the ECB wants Greece to remain in the euro area, but it is necessary to reach an agreement - this, which would have resulted in economic growth was supported by fiscal and solve problems remaining sources of financial instability.


The pound appreciated sharply against the dollar, returning all previously lost positions today, due to expectations of the meeting of the Central Bank of Britain. Recall, on Thursday will be announced the results of the next meeting of the Bank of England, which experts do not expect a change in monetary policy. Leaders of the Bank of England is expected to grow the UK economy in the 2nd quarter accelerated after a weak start of the year. In May, all nine members of the Monetary Policy voted to leave its key interest rate at a record low 0.5%, and the volume of bond purchases - at the level of 375 billion pounds.

Previously, the pressure on the pound had evidence of business activity in the services sector. UK service sector expanded weakest pace in five months in May as the pace of growth in output and new business deteriorated, showed on Wednesday the results of research by Markit Economics. The seasonally adjusted index of purchasing managers in the UK for services from Markit / CIPS, fell to 56.5 in May from 59.5 in April. However, any reading above 50 indicates expansion in the sector. Last index decline was the steepest since August 2011, but it is still above its long-term average of 55.2. New orders received in the UK services sector grew twenty-ninth consecutive month in May, but the pace of growth was the slowest since December 2014.

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