While the European currency is trapped in a narrow side channel paired with the US dollar, the British pound finds the strength to overcome more and more resistance levels amid the appearance of at least some information regarding Brexit.
Let me remind you that the pound was supported by the statements of the British Prime Minister Theresa May at the beginning of this week, while today's representatives of the British political elite also spoke on the current agreement.
The pound made its way through the annual maximums and continued its upward correction after the statements made by the Minister of Commerce of Great Britain Liam Fox, who noted that it is likely to have time to work out a deal and implement it by March 29, since the biggest risk for the country is when politicians fail to cope with challenge. According to him, Brexit without an agreement is possible, but unlikely.
Today, the head of the IMF, Christine Lagarde, spoke on Brexit, saying that Brexit creates additional tension for both the EU and the UK.
The likelihood of a softer Brexit, or the extension of the UK exit from the EU, which traders and experts are now focusing on, will make it possible to count on further purchases of the British pound under current conditions. The breakthrough of this year's high maximum around 1.3000 triggered a series of stop orders, which made it possible to continue the upward correction in the trading instrument, whose immediate target would be the levels of 1.3065 and 1.3130.
The Canadian dollar continued to decline today in tandem with the US dollar after a weak report on retail sales in Canada, which sharply declined amid falling sales at gas stations.
According to a report by the National Bureau of Statistics of Canada, retail sales in Canada in November 2018 fell by 0.9% compared with October and amounted to 50.39 Canadian dollars. Economists had expected sales to fall by 0.6% in November. Compared to the same period of the previous year, retail sales in November increased by only 0.5%.
The Japanese yen also continued to decline against the US dollar, after it became known that the Bank of Japan left interest rates on deposits at a negative level in the region of -0.1%, and the target level of yield on 10-year bonds was in the region of 0%. The bank said that they will continue to make the purchase of government bonds in the amount of 80 trillion yen per year. The statement also noted that current interest rates will persist for a long period.
Core CPI is expected to grow by 0.8% in the current fiscal year versus a previous forecast of 0.9%. As for economic growth, the economists of the Bank of Japan forecast real GDP growth of 0.9% in the current fiscal year against a previous estimate of 1.4%.
The head of the Bank of Japan has repeatedly noted that it will only be possible to talk about an increase in interest rates after inflation reaches a target value of 2.0%.
The material has been provided by InstaForex Company - www.instaforex.com