A Week in the Market (19.07 - 25.07): the Summer Calm is Already Here
There will be few numbers to analyse in the middle of both July and summer, and even fewer important events to reflect on. However, now is the exact moment when financial markets need to take a break to get rid of a lot of unnecessary emotions.
USD: the demand for the dollar is still there
This week, the USA is not going to publish too many important statistics – mostly, it will be about the real estate market. However, the demand for the “greenback” as a “safe haven” asset remains quite strong while investors are getting rid of needless illusions.
EUR: rate will be defined by the ECB
This week, the European Central Bank is scheduled to have another meeting, where it is expected to decide on the benchmark interest rate and provide its economic outlook for the future. There are reasons to believe that the tone of the regulator’s comments may be pretty rough, thus allowing investors to fantasize about early reduction of stimulus programs. It might help EUR to improve for a while.
JPY: the Yen might be in demand
The Japanese Yen is highly likely to be in high demand as a “safe haven” asset while financial markets are correcting. This week, the Bank of Japan is going to publish its Monetary Policy Meeting Minutes, where investors may find important details of the economic outlook forecasts released earlier. In this light, JPY may rise.
Brent: everyone is selling on the facts
After OPEC+ announced its decision to increase the daily output starting August 2021, the “overboughtness” in Brent started plunging. Фе the moment, investors are decreasing risk premium in the price and Brent might lose 2-4% from the current levels.
RUB: the Bank of Russia is rather aggressive
The Bank of Russia is also having a meeting this week, where it is highly expected to raise the interest rate by 100 basis points at once in order to fight inflation. These expectations aren’t likely to come true but the rate will be surely increased. For RUB, this possibility is already included in quotes and the currency may become more volatile on Friday.