The initial tone of Thursday trades was set by the information of the S&P and Moody’s rating agencies concerning the probable decrease of the Greek rating. It caused the sales-outs of the risky currencies and the dynamics escape into the shelter-currencies i.e., the US dollar and yen. However, later the situation flattened out a bit. The assurances of the Head of FRS B. Bernankey as for the low rates would be supporting the economy, which still looked like dull and needed maintenance despite the already begun growth, were caught at the market; moreover they seemed to be convincing amidst the disappointing data about the employment in the USA that appeared again. Under these circumstances the euro has even neglected all its daily losses against the US dollar and turned out to be in plus. The only GB pound found itself a looser among all majors against the US dollar at the trading on Thursday. The US statistics demonstrated another worsen in the employment branch as last week the number of the preliminary jobless claims suddenly grew up till highest possible level for last three months. The likely dynamics was observed in concerns of the secondary claims. In accordance with the published data the quantity of the preliminary appeals rose for 22 thousand till 496 thousand. The data of the week that preceded the one under review were revised to 474 thousand from 473 thousand. Meanwhile, the durable goods orders grew up for 3.0 per cent in January, whereas the increase of this indicator was expected for 1.5 per cent only. The activity in the manufacturing within the responsibility area of FRB Kansas-City turned out to be not bad as well in February. The monthly provision managers’ index for the manufacturing made 19 in February against 13 a month before, while the annual indicator grew up till -9 compared to -10 a month earlier. The set of today news is interesting due to précised data of the US GBP first of all. This information can set a tone to the trades of the second half of Friday if it turns out to be a surprise; in the meantime the forecasts resolve themselves till the maintenance of the previous level of 5.7 per cent still yet. Furthermore, the market will pay special attention to the sales of the ready homes market, provision managers’ index (PMI) Chicago, and the consumer confidence index after the University of Michigan. The results of the houses’ sales and the data from the “Michigan” are predicted with the growth; but the information from the Chicago managers are expected with worsening; and that can not only neutralize the positive information, but also abate the investors’ spirits hard.

EUR
   The common European currency started the day from the decrease against the US dollar and even turned out to be at the minimums of the recent days, next to the support at 1.3450. The sales of the euro were reasoned by the Moody’s Agency’s information that appeared on Thursday about the A2 Greek rating could be decreased: as this agency is the only one that maintained the rating of this country at A level this report effected the market greatly. The Standard & Poor’s Agency had marked itself with the analogous warning. The market is very troubled with the issue of the Greece’s ability to rollover its debts as it’s necessary to do this even in April and May, at that to a total amount of 8 Billion of euro. The current state of affairs is also dramatized by absence of signs concerning the intents to render aid to Greece from the side of the state authorities of the other Euro zone’s countries. Furthermore, the analysts call the sums, which are necessary according to their estimation to save other countries of the union, for example Spain, while here the capacity is determined to 270 Billion of dollar. Nevertheless, the euro found its strength to get back its positions lost on Thursday and even achieve the positive sector against the “buck”. The repeat of the announcements concerning the maintenance of low rates by B. Bernankey has obviously offered benefit of transformation of “quantity into quality” as the growth at the gold markets and the stock ventures of the USA gingered the interest to risk up, and that exactly expressed in the purchases of the euro. The economic data of the Euro zone demonstrated the steadiness of the labor market in Germany for February as the number of the jobless grew up for 7 thousand only; whereas +20 thousand were expected. Besides, the estimation of the jobless capacity’s increase was revised to 5 thousand from 6 thousand in January. Nevertheless, the unemployment level made 8.2 per cent in February against 8.1 per cent in January. The sentiment indexes in the Euro zone have never shown the improvement as expected; because the general behavior index fell down to 95.9 in February against 96.0 in January, and the consumer sentiment index decreased and was equal to -17 in February after -16 in January. But the spirits in the economic branches increased a bit as the manufacturing sentiment index grew up and rose up to -13 from -14, and the services confidence index – till +1 against -1 in January. The key point of the EU new set for today will become the consumer inflation. It should be mentioned that the indexes are predicted with the growth per month in Germany, but with the decrease over the Euro zone; as for the annual comparison the opposite picture is presumed i.e., the decrease in the in the largest European economy and the increase in the Euro zone in general.

GBP
   Having started the trades with the decrease amidst the general market opinion – "on the US dollar" alongside to the news about the decision of rating agencies, the British pound achieved the new factor of pressure from the side of the data about the capital investments of the British companies, which demonstrated the shortage of investments in 2009 down to its minimums over the whole history of the observations. The data demonstrated that in the 4th quarter of last year the investments lowered down to 5.8 per cent in comparison with the 3rd quarter and to 24.1 per cent in the annual comparison in the "Isles". That greatly enlarged the opinion that the revision of GDP, which are going to be published today, will be remarkable for disappointing dynamics. The published later report about the retailing capacities in February from the Confederation of British industries (CBI) demonstrated very good result, but it ceased the sterling collapse not for a long time. The retailing index in Great Britain increased to +23 in February from -8 in January. The appearance of BoE functionaries didn’t also encourage to the sterling’s purchases as they contained the announcements about the economic dullness and hints on the further accomplishment of the quantitative softening programs. Today is quite a significant day for the sterling as the précised data of GDP for the 4th quarter are prepared to publication; the forecast expects the revision with improvement per quarter till 0.2 per cent q/q, after 0.1 per cent q/q, and less annual compression, till -3.1 per cent y/y, from -3.2 per cent y/y. However, by reasons mentioned before the expectations may not be confirmed and in case of weaker result the pressure upon the sterling will be renewed. Besides, the homes price index from the Nationwide is going to be represented, the continuation of the growth is expected to be observed, at that for two-digit number annually, 0.4 per cent m/m, and 11.0 per cent y/y. The indicator of consumer confidence from GfK published already today demonstrated the growth to -14 from -17. That impressed the market to some degree; and the GB pound has increased a bit today; but as it had been mentioned the information from GDP will be determining.

JPY
   The Japanese currency continued its growth against the US dollar and other majors and completed the Thursday session with great plus all over the “front”. Obviously, all European events, the weak labor market in the USA, and the assurance about the absence of FRS intents to increase the rates, gave a decisive signal to the investors about the departure from the risk to the shelter-currency called the yen. However, the increase at the stock markets at the end of the day weakened the Japanese currency, but the interest to the profit fixation possibly appeared at the market. The data published already today as for the Japanese economy may be considered as mixed as in January the retailing increase was observed 2.6 per cent y/y against -0.2 per cent y/y, and the advancing manufacturing index 2.5 per cent m/m against 1.9 per cent m/m. But the efforts of the state authorities in "The Land of Rising Sun" at struggle with deflation haven’t been denoted with success still yet. The consumer prices nationwide index for February kept itself at its previous level -1.3 per cent y/y against -1.3 per cent y/y earlier, and the consumer prices index for January for Tokyo decreased slightly, till -1.8 per cent y/y, from -2.0 per cent y/y. The development affairs were improved as the number of the new development projects increased to -8.1 per cent y/y in January, against -15.7 per cent. Nevertheless, the statistics hasn’t made any influence upon the yen’s positions as usual: the yen started the day with the decrease, which will probably last. As it seems, the escalation of anxieties as for the interventions from the side of BoJ may started at the market together with the profit fixation as it usually happens at the occurrence of the pair of USD/JPY within the price range lower than 89.00.

Analysis prepared by:

Arkady Nagiev
Forex4you analyst