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Fundamental Review for April 14: China, Risk Assets, USA Investor sentiment on global markets remains moderately optimistic after the release of statistics on China's trade. According to the PRC General Directorate of Customs, exports in March fell by 6.6% YoY after falling by 17% in February. Imports were down 0.9% after falling 4%. Such dynamics indicate that business activity in the country began to recover after quarantine, which supported the appetite for risky assets in global financial markets. Additional support to risk is provided by a visible slowdown in the spread of coronavirus in the world. According to official sources, only 70 thousand new cases of the disease were detected yesterday. However, investor sentiment may already worsen after the International Monetary Fund (IMF) conference, at which representatives of the organization will present a revised forecast for the dynamics of the global economy in 2020. New data is not expected to please markets. As for the United States, the banking reporting season is starting today: Wells Fargo and JP Morgan are expected to publish financial results. The US stock market may be under visible pressure if financial indicators do not meet the expectations of analysts.

Brent. April 13, 2020 – Oil declines despite new OPEC deal At the beginning of the week, oil shows a decline to the area of $31 per barrel. This weekend, OPEC, Russia, the United States and other oil-producing countries nevertheless came to an agreement on the main conditions of the new deal and agreed to reduce production by 9.7 million barrels per day during May-June. Such volumes account for about 10% of global supplies. Experts note that this decline in oil production has become the largest in history. Previously, the pact participants intended to reduce production by 10 million barrels per day, but Mexico refused to reduce its share by 400 thousand. The United States agreed to take on part of the Mexican share, thereby reducing it to 100 thousand barrels. Despite the success of the negotiations, traders are in no hurry to open «long» positions. The problem is that the actual reduction is still not enough to eliminate the imbalance in the oil market (in the amount of 20-25 million barrels). Moreover, the new deal will end in June, so the issue of additional reduction will again become relevant in the second half of the year.

USD/CAD. April 10, 2020 – Canadian dollar is stable despite weak statistics The USD/CAD pair continues to decline slightly, almost close to 1.3900. The Canadian currency is showing a strengthening, even despite the decline in oil quotes from the level of $35.40 to the area of $31.70 per barrel. Moreover, weak data on the labor market in Canada also did not have the proper negative impact on the «loonie». According to statistics from the National Bureau of Statistics Canada, the number of jobs in March fell by 1.011 million, which significantly exceeded the previous record monthly drop of 125 thousand jobs in 2009. Unemployment in the country rose to 7.8% compared to 5.6% in previous months. Business activity data also showed a significant decline. The Ivey Business Index fell from 54.1 in February to 26.0 in March. Experts predict that in April the situation will only worsen, so the further strengthening of the Canadian dollar is in question. Today during the day the pair USD/CAD will consolidate near the level of 1.39.

Fundamental Brent analysis for April 9, 2020 Today may be crucial for the global oil market. In the evening, the OPEC online-meeting starts, at which the ministers of the participating countries will discuss the adoption of coordinated measures to neutralize excess supply and maintain prices for «black gold». In anticipation of this important event, Brent quotes are showing growth to the level of $34 per barrel. The new deal could include the United States, Mexico, Norway, Canada and other countries with a total production of 70 million barrels per day. Russia noted that it was ready to reduce production by 1.6 million barrels per day, if the United States also joined the leading countries of the deal (Russia and Saudi Arabia). However, the States are not confident in their participation in either today's videoconference or a future deal, noting that oil production in the country is already declining for natural reasons. Thus, America’s position may again hinder the conclusion of a global deal. Today, pressure on Brent may have yesterday's report from the US Department of Energy on US crude oil inventories. The data reflected an unexpected increase in stocks of 15 million barrels per week, while analysts predicted growth of 9 million.

EUR/USD. April 08, 2020 – Euro consolidated at 1.09 The euro has stabilized in the range of 1.0830-1.0900. Market participants remain neutral in the absence of important macroeconomic publications. Today, one should pay attention only to the publication of the minutes of the previous meeting of the US Federal Reserve System, according to which it will be possible to understand whether all members of the monetary committee agree to sharp cuts in the Fed rate. Also, this publication will allow to get acquainted with the Fed estimates regarding the extent of the recession in the US economy. Yesterday, a videoconference of finance ministers of the eurozone member countries took place, which culminated in the failure of the participants to agree on cooperative measures to overcome the economic crisis caused by the coronavirus pandemic.

Fundamental Brent analysis for April 7, 2020 Brent quotes continue to grow, despite the uncertainty about the upcoming OPEC+ video conference. The current Brent quote is $ 33.75 per barrel. Prices continue to stay above $30 per barrel, receiving support from reports that Russia is ready to discuss a serious reduction in oil production. However, many countries, including Saudi Arabia, cannot come to any formal agreement on quotas and terms, so the situation around the deal remains uncertain. It is worth noting that the United States and Canada will not take part in the OPEC+ virtual meeting on April 9, which put some pressure on the market.

EUR/USD. April 06, 2020 – The euro began to strengthen from the level of 1.0770 The euro suspended its decline at 1.0770 and rebounded to 1.08. Today the news background for the pair is quite calm, only data on the volume of industrial orders in Germany for February and the Sentix investor confidence index for April in the eurozone will be of interest. The first indicator decreased by 1.4% m/m against the previous growth of 4.8% m/m. Regarding the second indicator: analysts expect it to fall to -30.5 points from the previous value of -17.1. At the end of last week, the United States provided data on unemployment in March: the indicator rose to 4.4% from 3.5% earlier, although it was predicted to rise only to 3.8%. The number of jobs outside the agricultural sector decreased by 701 thousand against the expectation of a decrease of 100 thousand. These data put pressure on the dollar, stopping its strengthening. Today, the EUR/USD pair will not show strong price fluctuations: it is expected to move within the range of 1.0750-1.0850.

EUR/USD. April 1, 2020 – Euro continues downtrend Yesterday, trading on the pair EUR/USD ended in a slight minus, and today the downward trend of the euro continues. The pair is moderately declining to the level of 1.09. Pressure on the European currency has had the publication of economic reports from the eurozone. According to preliminary data, inflation in March slowed down from 1.2% to 0.7% year on year, while experts expected a decrease to 0.8%. The base consumer price index was 1% versus 1.2% a month earlier. The dollar was supported by the decision of the US Federal Reserve to expand the ability of dozens of foreign central banks to access dollars during a pandemic. Some support was also provided by data on consumer confidence in March. The country recorded a drop in the consumer confidence index to 120 points, which is the minimum since July 2017. However, market participants expected a decline to 110 points. Today, you should pay attention to the unemployment data in the eurozone for February (the indicator fell to 7.3%). Data from the USA will also be of interest: a change in the number of employees from ADP for March, the index of business activity in the manufacturing sector for March and the ISM manufacturing index for March.

Fundamental analysis for Brent, March 31 Brent crude oil remains under pressure, although quotes today are showing some recovery to $27.70 per barrel. However, this growth does not seem to be lasting, since the external background remains extremely negative for the recovery of the oil market. The pressure on oil is exerted by significant restrictions on business activity in most countries of the world, as well as the threat of increased production in Saudi Arabia and Russia. On the previous day the Saudis announced their intention to increase oil exports by 600 thousand barrels per day since May. This suggests that Moscow and Riyadh do not intend to return to their previous agreements regarding oil production. According to analysts, the global demand for oil in the II quarter of the year may fall by 12 million barrels per day, which will be the strongest decline for all time. Thus, all current factors signal that in the coming months the situation in the oil market may worsen, and the price of «black gold» risks fixing itself below $20 per barrel.

EUR/USD. March 30, 2020 – The level of 1.1160 stopped the growth of the European currency At the end of last week, trading on the EUR/USD pair ended with an increase to the level of 1.1160. The dollar remains under pressure due to a sharp increase in dollar liquidity by the central banks of developed countries. However, today the pair quotes began to decline to the level of 1.1050. The dollar was again in demand amid reports that the quarantine regime in the United States was not expected to end early. The US President said that the authorities extend the restrictive measures until the end of April. Today, attention should be paid to inflation data in Germany, the consumer confidence index in the eurozone, as well as to the change in the volume of pending home sales in February in the United States.

EUR/USD. March 27, 2020 – Correction to the average The currency pair EUR/USD dollar at yesterday's auction rose by more than 1,500 points, closing at 1.1025. The price of EUR/USD reached a key resistance level of 1.1000, located at the convergence of the lines of exponential moving averages for 21 and 60 days - EMA 21 and EMA 60. Strong growth of the pair was promoted by the report on unemployment in the USA published yesterday, which had a strong negative impact on the dollar against all major world currencies. At the same time, Fed Chairman Jerome Powell managed to calm the markets and US stock indices, including the industrial Dow Jones showed daily growth. Despite the strong influence of fundamental factors, in the medium term I still expect the correction to complete and the downward trend to continue, as the European economy also suffers large losses, and investors traditionally prefer to hide from risks in the dollar.

EUR/USD. March 26, 2020 – Breakdown of resistance level of 1.0800 The EUR/USD currency pair yesterday rose another 1000 points, closing at 1.0876. The price of EUR/USD was able to overcome the resistance level of 1.0800 by updating the local maximum for the last 4 trading days. The pair continued corrective growth, and today is testing the level of 1.0900. Apparently, the stimulus programs of the US government have a strong negative impact on the dollar. I expect further development of the correction to the level of 1.1000, located at the point of convergence of the lines of exponential moving averages for 21 and 60 days - EMA 21 and EMA 60.

EUR/USD. March 25, 2020 – Correction development. The EUR/USD currency pair is at 1.0800, the updated three-day high at 1.0885, but then rolled back. The price of EUR/USD rose by more than 500 points. Today the pair continues corrective growth. Apparently, buyers aimed at the level of 1.0900 and, most likely, will reach it in the near future. Corrections for stretching the borders are at around 1.1000, EMA 21 and EMA 60. I observe the development of situations that await the return of sellers to the market.

Fundamental Brent analysis for March 24, 2020 On Monday, a barrel of Brent crude was trading in a narrow price range at around 27.00, in the region of lows over the past 17 years. Today, oil quotes are gradually recovering mainly due to the weakening US dollar. As of 13:00 Moscow time, Brent crude rose by 5.33%, to $ 28.47 per barrel. The American currency is becoming cheaper due to the decisive actions of the US Federal Reserve. Regulatory officials announced an unlimited program of quantitative easing, let us know that they will buy as many assets as needed. The previously announced QE volume was equal to $ 700 billion. At the same time, in the medium term there are no factors that would allow oil to restore its lost positions.

EUR/USD. March 20, 2020 – Euro continues to weaken: 1.0650 and this is not the limit The euro continues to update lows paired with the dollar. The EUR/USD quotes fell to the level of 1.0650, from where the euro made a corrective rebound to the level of 1.0755. The US dollar has been in high demand in recent days as investors flee into defensive assets amid the spread of panic in the markets due to the coronavirus. A growing number of world central banks are softening their monetary policies: in particular, the Fed has already lowered the rate, the Bank of England, the Reserve Bank of Australia, the Central Bank of Indonesia, the Philippines, Brazil and Taiwan. Moreover, it became known that the US Federal Reserve, together with the central banks of Brazil, South Korea, Mexico, Singapore, Australia and other countries, launched swap lines to provide dollar liquidity directly to central banks for at least 6 months. Will these measures be enough to reduce the level of panic on world markets, time will tell. And today you should pay attention to the release of data on changes in home sales in the secondary market in the United States, the balance of payments of the ECB in January and the report from Baker Hughes on the number of active oil drilling rigs.

AUD/USD. March 19, 2020 – Australian dollar continues downtrend Today, the Australian dollar fell to the level of 0.55 paired with the dollar, but managed to recover to 0.58. The pair AUD/USD fell even before the Reserve Bank of Australia (RBA) lowered interest rates to 0.25%, which was a record low. The head of the regulator, Philip Lowe, said that the bank’s board of directors will not increase the target rate until full employment and inflation target of 2-3% are achieved. According to current data, in February the unemployment rate in Australia unexpectedly fell from 5.3% to 5.1%. Analysts had expected the rate to remain unchanged. Employment in the country increased by 26.7 thousand people in February, while estimates of specialists suggested an increase of only 6.3 thousand. Thus, the unemployment rate fell by 66%. During the day, the pair will fluctuate near the level of 0.58.

EUR/USD. March 18, 2020 – Euro fluctuates below 1.10 The euro continues the downward trend, having broken down the level of 1.10. The US dollar remains strong amid increased demand for dollar liquidity amid rising investor concerns about an impending recession in the global economy. In addition, the greenback was supported by plans of the US presidential administration to introduce a full package of measures to support the economy, including making payments of $1,000 to all residents (to stimulate domestic demand). At the same time, pressure on the euro continues to be provided by incredibly weak data on economic conditions and sentiments from ZEW in Germany. The first indicator fell in March to -43.1 points against the forecast of -30 points. The economic sentiment index fell to -49.5 points, although experts expected a decline to -26.4. The economic sentiment index in all countries of the eurozone amounted to -49.5 points against 10.4 a month earlier. During the day, the EUR/USD pair will continue to fluctuate below the strong support level of 1.10.

EUR/USD. March 17, 2020 – Euro collapsed after the release of ZEW data from Germany Today, the US dollar began to rise, reaching 1.1000. The currency received the main support from expectations that the world central banks will follow the example of the US Federal Reserve and also lower interest rates in their countries in the nearest future. The spread of coronavirus around the world has led investors to flee to safe harbors, in particular – to the US dollar. This trend of strengthening the American currency was interrupted on Sunday, when the US Federal Reserve decided to urgently reduce the rate to 0-0.25%. However, already on Tuesday the general background changed, and the upward trend in the dollar returned to the markets. Today, you should pay attention to the publication of the March index of economic expectations and sentiment from ZEW in Germany. The indicator crashed from a level of 8.7 points to -49.5. Such a strong decline put significant pressure on the euro, becoming the sharpest decline since December 1991.

EUR/USD. March 16, 2020 – Dollar weakens after Fed’s decision to cut rate again The US dollar came under strong pressure after an emergency cut in the US Fed rate on Sunday. The regulator reduced the rate immediately by 100 bp. to 0-0.25% for the first time since 1982, and also announced the launch of a large-scale program for the purchase of financial assets with a total volume of $700 billion. As a result, the EUR/USD pair rose to the level of 1.1230. The situation with the further development of the coronavirus pandemic puts pressure on all global markets. More and more countries restrict the movement of people, close their borders and introduce other quarantine measures. In the United States, a state of emergency was declared on Friday. The set of preventive measures of the US government signals the increased risks of a recession in the US economy, which forms a negative background for all risky assets. During the day, the pair will fluctuate near the level of 1.12.

Fundamental Brent analysis for March 13, 202 Yesterday, Brent quotes fell again to the level of $32.50 per barrel amid panic sales in global markets. However, today prices are already showing a recovery to $35.40 per barrel. Support for Brent and other risky assets was provided by the US Federal Reserve reports on a massive infusion of dollar liquidity into the system in the near future. However, one should not expect a significant strengthening of «black gold», since the situation with the spread of coronavirus in the world remains very dangerous, and OPEC oil-producing countries continue the price war in attempts to increase their market share.

EUR/USD. March 12, 2020 – Euro weakens awaiting ECB meeting Negative sentiment caused by a statement by the World Health Organization (WHO) has returned to global markets. Yesterday, WHO officially assigned pandemic status to the spread of the virus Covid-19, which put strong pressure on the entire block of risky assets. Additional pressure on the markets had a 30-day US ban on entry to the country for all travelers from Europe. The pair EUR/USD is trading at 1.1250. The euro is moderately declining, under pressure from the words of the ECB head K. Lagarde. The politician said that in the absence of coordinated actions by the authorities, the situation in the EU economy could develop according to the 2008 crisis scenario. Today, attention should be paid to the ECB meeting. Market participants expect the regulator to introduce a range of monetary incentives, and the scale of measures taken is of particular interest. At the same time, the US dollar received support after the release of inflation data in the country. Annual inflation in February slowed to 2.3%, better than forecasted.

EUR/USD. March 11, 2020 – The pair near 1.13 in anticipation of US inflation data The US stock market is gradually recovering after the collapse on Monday, and investor sentiment on global markets remains relatively optimistic. The current quotation of the EUR/USD pair is 1.1300. The dollar received some support after U.S. President Donald Trump discussed payroll tax cuts with Republican officials as part of tax breaks. However, the further spread of coronavirus outside of China still retains the risks of further sales in the financial markets. The number of cases worldwide continues to increase. In the USA, in particular, the number of cases has already exceeded 1000 people. Today, attention should be paid to inflation data in the United States, which may reflect its deceleration from 2.5% to 2.2%. Amid the expectation of another Fed rate cut at the March meeting, this slowdown could trigger a wave of sales of the US dollar.

EUR/USD. March 10, 2020 – Euro fell from highs to 1.1325 The growth of the European currency was stopped by the level of 1.15 – EUR/USD quotes fell on Tuesday to around 1.1325. Yesterday, a drop in the oil market to $32 per barrel triggered a collapse of major indices around the world. In addition, the continued spread of coronavirus outside of China also continues to put pressure on world markets. It became known that Italy introduced a regime of emergency measures to combat the virus throughout the country, and the head of WHO said that the outbreak of the virus is already very close to becoming a pandemic. The presence and further spread of coronavirus in Europe puts pressure on the euro. The US dollar, in turn, is under the negative impact of rising yields on 10-year US Treasury bonds and expectations of a Fed rate cut immediately by 70 bp. on the meeting of the American regulator on March 18. During the day, the EUR/USD pair will continue to grow from the level of 1.1325.

EUR/USD. March 06, 2020 – Euro approaches 1.13 high The euro continues to increase the pace of strengthening, approaching the level of 1.1300. Pressure on the dollar was exerted by an unplanned reduction in the interest rate of the US Federal Reserve, reflecting the fears of the authorities about the presence of significant risks in the country's economic system. Moreover, the Fed rate can be cut by another 25 basis points (from the current target range of 1.00-1.25% per annum) at the meeting on March 18-19. This could trigger a wave of sales of the American currency and send the pair to the 1.1400 area. The spread of coronavirus in Europe remains high, which puts pressure on risky assets. Today's statistics on the US labor market may have an additional negative impact on risk and dollar if the current data are below forecast. In case of further deterioration in risk appetite, the euro will continue to receive support in the Forex market.

EUR/USD. March 05, 2020 – The euro slowed down its growth at the level of 1.12 The level of 1.1200 restrains further growth of the European currency, the current quotation of the EUR/USD pair is 1.1170. The day before the US dollar was under pressure after an unexpected Fed rate cut by 50 bp at once. However, yesterday evening this pressure slightly decreased amid the publication of strong labor market data from ADP and the ISM index in the service sector, which in February rose from 55.5 to 57.3. Today it became known that the California authorities in the United States announced an emergency mode because of the risks of the coronavirus spread, and Italy decided to close schools until March 15 in the fight against the epidemic. The news signals that the risks of a recession in many economies are still extremely high. Today you should pay attention to the weekly statistics on initial applications for unemployment benefits in the United States. Experts predict a decrease in the number of calls from 219 thousand to 215 thousand.