The United States of America

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

Investors focus on the comments of representatives of the US Fed regarding its further actions. Thus, the President of the Federal Reserve Bank (FRB) of Atlanta, Raphael Bostic, noted that inflation will return to the target level of 2.0% later than expected, so there is no rush to adjust monetary policy and suggested that interest rates will remain at the current levels until the end of the year. New York Fed Chairman John Williams added that the moment to reduce borrowing costs would come, but it would depend on the state of the national economy. Regulator officials are taking a cautious approach, which increases the likelihood of a move to the “dovish” rate in September. Meanwhile, the existing home sales confirmed the weakening of the real estate market, decreasing by 4.3% to 4.19M.

Eurozone

EUR is strengthening against GBP, JPY, and USD.

In March, the German producer price index increased from –0.4% to 0.2% MoM and from –4.1% to –2.9% YoY. Thus, wholesale inflation in the leading Eurozone economy is falling, leading to easing consumer price pressures. According to Reuters sources, soon, the German government will raise its gross domestic product (GDP) growth forecast for the current year from 0.2% to 0.3%, and the inflation rate will drop to 2.4% by the end of the year, from the previous 2.8%. In 2025, the figure should increase by 1.0%, and inflation should reach 1.8%.

The United Kingdom

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

In March, retail sales increased by 0.8% YoY and showed zero dynamics, MoM, while experts expected an increase of 0.3%: the figure did not increase for the first time since December, despite a significant weakening of inflation. Analysts believe that household spending may not recover in the first quarter, which will slow the British economy’s exit from recession.

Japan

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

In March, the nationwide consumer price index fell from 2.8% to 2.7% YoY, and the core index fell from 2.8% to 2.6%, compared with forecasts of 2.7%, letting the Bank of Japan officials take a break from tightening monetary policy. However, two-thirds of experts polled by Reuters expect interest rates to rise to 0.20% or 0.25% in the third or fourth quarter.

Australia

AUD is weakening against EUR and GBP but has an ambiguous performance against JPY and USD.

Due to a lack of significant economic releases, the currency movement is due to external factors. Next week, Q1 inflation data will be published, which could significantly influence the further actions of Reserve Bank of Australia (RBA) officials. According to preliminary estimates, the consumer price index will decrease from 4.1% to 3.4% YoY, and the core indicator — from 4.2% to 3.8%, allowing the regulator’s economists to move on to adjusting monetary policy, thus weakening the Australian dollar.

Oil

The morning rise in oil prices gave way to a decline.

Positive dynamics developed after reports of an Israeli missile attack on an air base near the Iranian city of Isfahan, which increased fears of the outbreak of a major conflict. However, the damage from the attack was insignificant, and the Iranian authorities made it clear that there would be no retaliatory action, so the asset lost the gained positions. The market has stabilized, and fears of interruptions in the oil supply from the Middle East region have decreased, but the situation can worsen at any time, which does not allow oil prices to decrease significantly in the medium term. In addition, the asset may be supported by American sanctions against Iranian oil exports, but it requires Congressional approval.