Weekly analysis of currencies: Consolidation of the euro / dollar above 1.22?

Weekly analysis of currencies: Consolidation of the euro / dollar above 1.22?

Analysis Department of Bankinter offers its forecasts for the next behavior currencies:

Eurodollar (€ / USD)

The minutes of the meeting of the European Central Bank (ECB) -publicadas the left Thursday- see the central bank prepares a change in  guidance  of monetary policy , which led to an appreciation of the euro. The need of stimulation is less justified by the growth cycle.

This week we expect the dollar stability . In front macro we will see positive data from the industrial sector in the US (industrial production + 0.3% m / m vs. + 0.2% previously) and the Beige Book (Fed) could show us evidence of price pressures. 

Estimated range (week): 1,205 / 1,235.

Euroyen (€ / JPY)

It seems unlikely that the Bank of Japan may reduce bond purchases if you want to fulfill its monetary policy objectives. Therefore, the yen weakened again (from Thursday) after having appreciated from 136 to 133.

We think that this weakening trend will continue moderately in the coming days. In addition, the Japan macro offers little surprise , only confirm the good performance of industrial activity (Prod. Industrial + 3.7%) 

Estimated range (week): 135,0,0 / 136.4.

Eurolibra (€ / GBP)

The cabinet reshuffle prompted Theresa May sterling , but ended up losing ground to a euro that was strengthened by less accommodative bias of the ECB and political developments in Germany.

This week the macro is not very important so the policy will continue to dominate the landscape and probably favorable for the pound since shuffled one Brexit less hard. 

Weekly estimated range: 0.875 / 0.89.

Eurosuizo (€ / CHF)

The euro appreciated to overcome the threshold of 1.18, after the publication of minutes of the ECB to hint at  guidance  of somewhat tighter monetary policy since early 2018.

In the coming days no relevant macro or the Economic and Monetary Union (EMU) or in Switzerland indicators are published, so that the crossing should consolidate levels. 

Weekly estimated range: 1,176 / 1,183.


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