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20:20

American focus: the US dollar appreciated strongly against most major currencies

The US dollar strengthened significantly against the euro, reaching a peak on 27 April. The reason for such dynamics were weak GDP data in the euro zone and US indicators optimistic. Revised Eurostat estimates showed that the euro zone economy expanded less than previously estimated. Gross domestic product grew by 0.5 percent in the first quarter compared with the previous quarter, when it grew by 0.3 per cent. Eurostat previously estimated 0.6 percent growth in the first three months of 2016. In annual terms, GDP growth fell to 1.5 percent from 1.6 percent. The annual growth rate for the first quarter was revised down to 1.6 percent. At the same time, the economy of the EU 29 countries registered an increase of 0.5 percent in quarterly terms and by 1.7 percent per annum.

With regard to the statistics on the US, the Commerce Department reported that retail sales in April recorded their biggest gain in a year, as the Americans have stepped up purchases of cars and a number of other goods. Retail sales rose 1.3 percent last month. The figure for March was revised down to -0.3 percent from -0.4 percent. Excluding cars, gasoline and building materials and services to the food, retail sales jumped 0.9 percent after rising 0.2 percent in March. Economists had forecast an increase total sales by 0.7 percent and core sales by 0.3 percent. In April, car sales rose by 3.2 percent, the biggest increase since March 2015, after being shown a sharp decline of 3.2 percent in March. Sales at service stations increased by 2.2 percent, reflecting the recent rise in gasoline prices. Sales in clothing stores increased by 1.0 percent, the biggest increase since May 2015. Online retail sales rose 2.1 percent, the biggest gain since June 2014.

Meanwhile, the final results of the studies submitted by Thomson-Reuters and Institute of Michigan, revealed in May consumer sentiment index rose to 95.8 points compared with a final reading of 89.0 points in April. According to average estimates, the index was up 91.0 points.

The pound depreciated moderately against the dollar, updating at least May, which was mainly due to the widespread growth of the US currency in response to the data on retail sales. Pressure on the pound have also had statements by the International Monetary Fund that the decision to withdraw Britain from the EU on the basis of a referendum on June 23 may have a negative impact on the economy. In this case, the UK GDP in the long run may be lower than 1% -9%, what will be, if it is to remain in the union. Exit from the EU can "provoke uncertainty growth, increased volatility in the financial market, as well as a negative impact on production", - says the IMF report. Statement by the IMF follows the Bank of England warning, who noted that the vote for the exit from the EU will slow down economic growth, will cause unemployment and inflation due to a sharp drop in the pound.

The Canadian dollar dropped more than 100 pips against the US dollar, updating the minimum on 11 May. In addition to the general strengthening of the US currency, affected the course of trading in the oil market situation. Today, oil futures are down again, ending a three-day rally, due to the partial profit-taking by investors before the long weekend. Recall on Monday, markets in many European countries, including Germany and France, will be closed for a public holiday. Further reduction of prices holding back the news from Nigeria, where, due to supply disruptions of oil production fell to 22-year low. Minister of Finance of Nigeria said that the country's oil production fell to 1.65 million barrels per day from 2.2 million barrels per day before the failure. Little influenced by a report from the Organization of Petroleum Exporting Countries (OPEC). As it became known, OPEC kept its forecast for global oil demand in 2016, which is expected to grow by 1.2 million barrels per day to 94.18 million barrels per day. In 2016, as the experts expect production in countries outside OPEC will decline by 0.74 million barrels per day (figure revised to 10 th. Barrels per day downward) to 56.4 million barrels a day.

18:47

WEEKLY REVIEW: Waiting for hints for further interest rate hikes by the Fed

This week was fairly quiet. The U.S. economic market data was mixed again. The initial jobless claims in the U.S. surprisingly increased last week. Are that signs of the slowdown in the U.S. labour market? The pace of the job creation also slowed in April.

Market participants are awaiting the U.S. labour market for May. The weaker-than-expected U.S. labour market could mean that the Fed would not raise its interest rate in June. The referendum on Britain's membership in the European Union (EU) on June 23 is also likely to weigh on the Fed's interest rate decision as Britain's exit from the EU would have a negative impact on the U.S. economy.

Oil prices rose this week, mainly supported by the wildfire in Canada. It is likely that we will see some correction in the coming days and weeks as the global oil oversupply still remained.

It is likely that the currency pair EURUSD will rise toward the high of May 11 at $1.1445, if there are negative news from the U.S. and there are no negative economic data from the Eurozone.

If the U.S. economic data is better than expected and in case of the negative economic data from the Eurozone, the currency pair EURUSD may test the low of April 22 at $1.1217.