GBP/USD: attempt to restore positions
The British currency shows sluggish strengthening in a pair with the US dollar, making attempts to recover the losses incurred during the trading session on Friday. The GBP/USD instrument is trading within 1.2250, trying to continue its growth.
Insignificant support for the asset is due to the results of the meeting of officials of the regulator of England in monetary policy. The summit participants decided to follow the example of their American colleagues and tighten monetary parameters more actively as part of the fight against rapid inflation. Pressure on consumer prices is exerted by restrictions on the employment market and strategic steps on the pricing policy of large national companies, which is intensified by the escalation of hostilities in Ukraine. The Central Bank of England increased the key indicator by 0.25%, reaching the target level of 1.25%, which is already the fifth increase in the level from December last year, which made the UK regulator the first "hawk" from the beginning of the coronavirus pandemic. Recall that several participants of the Committee meeting spoke in favor of a sharper rate of increase of the indicator by 50 basis points, nevertheless, the vote was held according to the model of the previous May meeting. At the same time, the threat of inflation for the national economy remains at a high level, which can cause a full-fledged recession.
- Resistance levels: 1.2250, 1.2328, 1.2400, 1.2457.
- Support levels: 1.2163, 1.2074, 1.2000, 1.1933.
AUD/USD: there is a bullish trend in the asset
During morning trading, the AUD/USD instrument shows steady growth, restoring the losses of last Friday. At the moment, the currency pair is holding positions at 0.6960 within the framework of upward dynamics, which may have a strong resistance to analysts' fears of a slowdown in global GDP growth.
Last week, the Australian currency found significant support due to reports on the national employment market. The May labor market indicator significantly strengthened by 60.6 thousand against the previous growth of 4.4 thousand in the previous period, exceeding experts' expectations of growth by 25 thousand. Meanwhile, the unemployment rate remains at the same level of 3.9%, against expectations of a decline to 3.8%. On June 21, market participants will expect the release of the final minutes of the RBA meeting and comments by the chairman of the regulator, Philip Lowe, on further steps to raise the interest rate in the medium term.
- Resistance levels: 0.7000, 0.7050, 0.7100, 0.7150.
- Support levels: 0.6950, 0.6900, 0.6849, 0.6800.
USD/JPY: "American" holds record positions
The US currency shows a mixed trend, being at the peak at 135.00. The yen tried to move to a corrective growth in the previous week, which was unsuccessful, and the US dollar recovered all losses at the end of the trading week.
The Japanese regulator continues to adhere to an ultra-soft monetary policy, keeping the rate within -10%, while the yield level of classic 10-year bonds remains at 0%. The Central Bank has expanded its program to buy an unlimited number of securities with a yield of 0.25%. Such steps found the support of the overwhelming majority of officials, only a few spoke in favor of starting a transition to a tight monetary policy. The authorities are more likely to make statements about negative effects on the national economy due to the weak yen, including rising import costs and complicating the situation for local companies with short-term forecasts, because the government has failed to complete a full recovery after the global Covid-19 pandemic.
- Resistance levels: 135.57, 136.50, 137.50, 138.50.
- Support levels: 134.54, 133.70, 133.00, 132.00.
USD/CAD: May high reached
The US currency continues to grow steadily thanks to decisive steps from the US Federal Reserve, which decided to strengthen the fight against inflation, which allows the USD/CAD pair to stay around 1.2995.
The past week was marked by the decision to increase the key indicator immediately by 0.75%, reaching the target of 1.75%, which helped the national currency to increase its positions against the Canadian dollar and update the May highs of 1.3065. According to the statement of the chairman of the regulator Jerome Powell, the authorities are ready to continue the fight against inflation, which has reached the maximum values of the last 40 years, and added that the measures taken yesterday will help make the US dollar more attractive to traders. In addition, the US government continues to monitor the global economic situation in order to continue the line of further tightening of monetary parameters in the short term, if necessary.
- Resistance levels: 1.3065, 1.3157, 1.3360.
- Support levels: 1.2950, 1.2860, 1.2525.