Earthquakes in Japan seriously impair industrial activity

Industrial activity in Japan accelerated its decline in April, as the PMI index Markit/Nikkei fell to its lowest level since January 2013 onwards, or to 48 points. Markets predicted a growth of 49.1 to 49.6 points.

According to analysts, the disappointing performance of the sector has been affected by the earthquakes in Kumamoto, which led to the restraint of production capacity.

Component, tracking production, retreat from 49.8 to 47.9 points, marking the strongest contraction of the indicator since April 2014.  New orders also weakened significantly - from 48 to 44.6 points, while new export orders reached their minimum since December 2012, or 44 points.

"After the devastating earthquake, the prospects for the Japanese manufacturing sector seem particularly uncertain." - said economist at Markit Amy Braunbil.

RBS expect GBP/USD at 1.3000

Forex Strategists at RBS comment on the latest report on the labor market in the UK, pointing to weak growth in wages. This indicator is closely monitored by the Bank of England, and minding, that retail sales also came under forecasts, the pound may be difficult to return to the levels of 2015.
Indeed, sterling showed remarkable resilience in the face of disappointing statistics, and, that according to analysts, reflects the excess of speculative short positions in British currency. At RBS warned that a new decline in the US dollar is not excluded and worries associated with such movements may lead to a sharp rise in GBP/USD and drop in EUR/GBP. However, such a correction would not last long and is not intended to be deep.
In the coming week investors' attention will remain directed to the polls on June referendum on membership of the United Kingdom in the European Union.
Strategists emphasize that although the temporary strengthening of the pound against the dollar, the general trend is hardly undergone change. Political uncertainty remains, and at RBS recommend selling GBP/USD in its attempts to grow with the aim of 1.3000. The set level will probably be reached in the next few weeks, predict analysts.

BNP Paribas do not believe in conspiracy agreements against the dollar

Forex strategists of BNP Paribas do not believe in the conspiracy theory that on the meeting of the leaders of the Big ten in February it was decided to countries to limit the strengthening of the dollar, or at least not seek to devalue their own currencies.

Analysts remind that the European Central Bank did not hesitate to cut rates in March and later its governor Mario Draghi emphasized that the institution is ready to adopt further stimulus if necessary. In Japan, representatives of Regulators also convince investors that it is possible to reduce rates if the dynamics of exchange rates goes out of control. Interventions in the market are also not excluded.

Ultimately, however, whatever was discussed at the meeting in February, the fact is that the US dollar weakened significantly, which contributed to the restoration of a number of assets, not least - commodity. And fears of imminent devaluation in China are also dispelled, which supported stock markets and credit instruments.

According to analysts at BNP Paribas, by examining the ratio between risk and expected return, the most appropriate seems the bet on the eventual rise of the dollar against the commodity currencies - such as the pair USD/CAD. The dynamics of the dollar against the currencies of financing, the euro and the yen is not so unambiguous, but probably the strengthening of the dollar will not last long and it will reverse it's direction amid an escape from risk.

By BNP Paribas expect levels of EUR/USD at 1.16 by the end of June, while USD/JPY forecast is for 108.00.

Bank of America: Will the April meeting of the Federal Reserve affect the dollar?

Current market quotations provide zero chance for raising rates at the next few meetings of the Federal Reserve, note forex strategists of Bank of America. Investors have calculated less then one increase in rates by 25 basis points by the end of the year. Minding the short-term outlook, disappointing macroeconomic data and cautious comments of regulators, similar position seems justified.

However, by Bank of America highlight that the global economic and financial picture stabilize, while not improving. Analysts believe that the US central bank will raise interest rates twice by 25 basis points in 2016. The next step in this direction will be taken in the summer, most likely - in June, but if a referendum on Britain's membership of the European Union increase significantly volatility, more likely the raising will happen July.

Could the April meeting of the Federal Reserve to alter the trajectory of the dollar? Hardly, according to the Bank of America. The central bank will remain cautious because the decline in the currency after the March meeting is a positive development. At present, the markets believe that the chance of an increase in rates in June is below 20%. Modest adjustments to the statement of Regulators would have only limited support of the dollar provide strategists.

Societe Generale: Bullish trend in EUR/GBP the past few months ended

EUR/GBP in the last few days remained under sustained pressure. The currency strategists of Societe Generale advised to pay attention to the fact that the technical picture becomes less positive and especially, that passing the lower limit of the bullish channel in December last year is a negative signal fro the pair.

The bank notes that the currency pair is very close to the support in 0.7880/30 pounds (lows for the last month and 50% of the growth on March 3-rd), and a more convincing break below these levels would have confirmed the beginning of a deeper corrective phase.

In this case, EUR/GBP could fall to 0.7650 pounds and Societe Generale believe that for those who dare to open short positions, it is advisable to place stop loss at 0.8000 pounds.

Lloyds Bank: Technical comment for EUR/USD

EUR/USD continues to rise slowly moving away from the area of ​​support 1.1240, the movement is supported by the weakness of the US currency.
Lloyds Bank has a bearish outlook and they believe that this growth is only a correction of the sharp drop from the key resistance at 1.1465. Currently the pair is in the middle of the resistance in 1.1325 - 1.1375 and a break below 1.1240 will open the way for test of 1.0950 and 1.0800.
In the medium term the pair will probably remain in the corridor 1.0450 - 1.1465.
Break above the upper limit is not the main scenario of the bank, but if it happens, the pair will have every chance to test the August maximum over 1.1700 but also to reach 1.2000 to 1.2300 and to form new trade limits.

Technical analysis of EUR/USD for April 19

EUR/USD was indecisive yesterday. The bias is neutral in nearest term but as long as the pair stay below 1.1335, the bearish scenario remains at this phase. The nearest support is 1.1275. A clear break below it could trigger further downside pressure for testing 1.1200. On the upside, a clear break and daily close above 1.1335 will become a threat to the bearish scenario re-testing 1.1500. The main technical outlook remains neutral.

The US dollar fell for a second consecutive day

The dollar started the week slightly, recording a fall against most major currencies after on the meeting in Qatar's capital Doha the main oil producers failed to agree to freeze yields.
Commodity currencies such as the Australian, New Zealand and Canadian dollar, and also the ruble, managed to raise, supported by the rise in oil prices. Black gold managed to erase most of its losses after oil meeting, managing to return over 39 dollars per barrel.
The yen retreated against the dollar. The Japanese currency fell with 0.8 percent to 109.10.
The Australian dollar continued its strong performance, reaching a 10-month high against the US dollar at around 0.7794.
William Dudley, president of the New York Fed, said earlier that US economic conditions are "for the most part positive." However, the Fed still wary of rising interest rates.
On the other hand, according to some economists, the European Central Bank may have run out of ammo. According to them, the institution will have problems in the future weakening of the euro. The single currency rose by 0.27 percent to 1.1312.
The dollar index, which measures the performance of the dollar against a basket of major currencies, fell with 0.26 percent to 94.50.

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The status quo in Syria remains - Assad wins the elections

The party of Syrian President Bashar al-Assad unsurprisingly won a large majority in parliamentary elections in the country.
The vote took place on Wednesday, but official results became clear today.
200 candidates of the bloc "National Unity", part of which is the Baas Party were elected to the 250-member unicameral parliament, said the Central Election Commission.
Turnout was 57.66 percent.
Protesters controlled by the regime territories, however shouting "Down with Assad" and "Get out, Assad."
5.08 million Syrians went to the polls in a total of 8.83 million potential
voters in the country devastated by five years of civil war.
The population of Syria before the outbreak of the conflict numbered 23 million. 13.5 million of them are affected by war in one way or another, according to UN data.