United States of America

USD is strengthening against JPY but has ambiguous dynamics with EUR and GBP.

Today, weekly data on the labor market were published: the number of initial jobless claims amounted to 212.0 thousand, which corresponded to the previous figure, but turned out to be less than forecasts of 215.0 thousand, while the total number of citizens receiving support from the state increased from 1.810 million to 1.812 million with preliminary estimates of 1.818 million. Thus, the labor market has again demonstrated resistance to the current tight monetary policy of the US Federal Reserve, which increases the likelihood of further maintaining interest rates at high levels. It is also worth noting the comments of the head of the Federal Reserve Bank (FRB) of Cleveland, Loretta Mester, who yesterday confirmed that lowering interest rates will become possible only when consumer prices begin to move steadily towards the target of 2.0%.

Eurozone

EUR is weakening against GBP but has ambiguous dynamics with JPY and USD.

Investors are focused on comments from leading officials of the European Central Bank (ECB) regarding the regulator's future policy. ECB Vice President Luis de Guindos said that if the decline in consumer prices continues, the reduction of interest rates will begin in June, and confirmed that inflation will finally reach the target level of 2.0% only in 2025. Slovenia's Central bank governor Bostjan Vasle said the Eurozone deposit rate should fall from the current 4.0% to "much below" 3.0% by the end of this year if price pressures continue to ease. ECB Governing Council member Mario Centeno also confirmed that a monetary policy adjustment in June looks most likely, but further actions will depend on incoming macroeconomic data. The official also said that even if borrowing costs fall by 25.0 or 50.0 percentage points, monetary policy will remain quite tight and will limit economic growth. Officials are ready to postpone changing the monetary course only in the event of emergency, for example, a significant aggravation of the geopolitical situation in the Middle East, which could lead to an increase in energy prices.

United Kingdom

GBP is strengthening against JPY and EUR but has ambiguous dynamics against USD.

In the absence of significant economic releases, the movement of the pound is determined by external factors. It is only worth noting the correction in the forecast for further actions of the Bank of England: Morgan Stanley analysts believe that after the publication of March inflation data, which recorded a slower decline than the market expected, the regulator may postpone the first reduction in interest rates from May to June. In total, this year the cost of borrowing will decrease by 75.0 basis points, which corresponds to three decreases (June, August, November). Experts also believe that signs of renewed growth in consumer prices are temporary and will not turn into a trend.

Japan

JPY is weakening against GBP and USD but has ambiguous dynamics against EUR.

Investors are focused on comments from Bank of Japan (BoJ) board member Asahi Noguchi, who said that the pace of future interest rate hikes is likely to be much slower than those of other global regulators as they tighten monetary policy. The official also noted that a stable increase in consumer prices to the target level of 2.0% can be achieved no earlier than 2026, and the date for increasing the cost of borrowing by BoJ will depend on incoming macroeconomic data. On Friday, investors await the release of March inflation data, with the national consumer price index expected to fall YoY to 2.7% from 2.8% and the core rate – from 2.8% to 2.7%. The implementation of these forecasts will increase the likelihood of keeping the key rate at the current level.

Australia

AUD is strengthening against JPY but has ambiguous dynamics with EUR, GBP, and USD.

Investors are focused on the publication of March labor market data: the unemployment rate increased from 3.7% to 3.8% with preliminary estimates of 3.9%, total employment decreased by 6.6 thousand instead of increasing by 7.2 thousand, and full employment increased by 27.9 thousand, which was significantly less than the February increase of 79.4 thousand. Experts believe that the labor market remains quite strong but is already beginning to show signs of cooling. If this trend continues, the Reserve Bank of Australia (RBA) will be able to begin adjusting monetary policy, but most economists still expect this to happen no earlier than the fall.

Oil

Oil prices today have ambiguous dynamics: the morning decline was replaced by an increase in quotes. The market is being pressured by the expectation of further improvement in the situation in the Middle East, as well as by rising inventories of petroleum products in the United States; however, a significant decline in prices is hampered by fears of the introduction of new American sanctions against Iran.

The US Department of Energy's Energy Information Administration (EIA) report published yesterday recorded an increase in commercial oil inventories by 2.735 million barrels, which was significantly higher than preliminary estimates of 1.600 million barrels, but gasoline inventories decreased by 1.154 million barrels and distillates by 2.760 million barrels. Restrictions on Iranian imports, according to experts, may have a very minor impact on the global supply of “black gold”, since its deficiency can be compensated by increased production from other producers. In addition, sanctions will completely lose their effect if they are not supported by China, the world's leading importer.