The continuing political uncertainty and the threat of an economic downturn in Europe led to a decline in the single European currency against the dollar. At the same time, even signs of a recovery in business activity in Europe did not help the euro to break out of the range of 1.11-1.10 dollars, in which it has been stuck since February. Surveys published by the industry showed a further decline in economic growth in April. In addition, the threat of higher rates for European cars in the United States and the upcoming European elections is also putting pressure on the currency. Against this background, the dollar looks attractive. The American continues to grow, aided by the economic data and the position of the Fed, voiced by Jerome Powell. The head of the regulator smoothed out fears caused by the recent slowdown in inflation. He said that he did not see any reason for lowering interest rates. The dollar will most likely continue to grow, especially if data on employment in the United States will be better than expected and the dollar is currently strong. Emerging markets are showing weak momentum, perhaps, you should think about selling.
In general, it was a quiet week for major currencies. The volatility indicator was at multi-year lows and liquidity was limited to holiday weekends in Japan and China. The British pound added 1.3 percent in anticipation of a breakthrough in the Brexit negotiations. Australian and New Zealand dollars weakened on the news that next week regulators in both countries will lower interest rates. The Reserve Bank of Australia officials will meet on May 7 and the Reserve Bank of New Zealand the next day. Anyone can lower rates after reporting low inflation. Currently, markets are estimated by the likelihood that the Fed will cut rates this year at 49 percent, compared with more than 61 percent before Powell's speech.
