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The euro rose against the dollar, having played with most of the previously lost positions, which was due to comments from Fed Chairman Ben Bernanke.
Fed Chairman Bernanke said that the course program of bond purchases is not predetermined. From the comments, it became clear that folding is expected, although he added that the Fed intends to keep policy highly accommodative for the foreseeable future. The program of bond purchases is flexible and will respond to the reports.
During the question and answer session, Bernanke said that the Committee is supported in its quest to use the 7% rate of unemployment as an indicator of recovery in the economy that the Fed must see before you decide to end the program.
He stressed, however, that 7% is not a goal for the Fed, but rather "the exponent of labor market recovery, which we want to see."
Also, the Fed chief said that the U.S. is in a difficult financial situation, but the markets have begun to understand how the Fed says. He said that monetary policy is too focused on the short term.
The cost of the Canadian dollar declined significantly against its U.S. counterpart, which followed immediately after the announcement of the Bank of Canada interest rates. As expected, the central bank left interest rates unchanged - at 1.0%. This level of BC commented on the level of a "substantial fiscal stimulus measures that are currently in force, are appropriate to the situation." The Bank of Canada also confirmed that total and core inflation expected to be low in the near future, before it is essentially grow to 2% by mid-2015, as the economy will return to full use of resources, and inflation expectations remain subdued.
Meanwhile, the Bank of Canada raised its GDP forecast for 2013 to 1.8% from 1.5%, and lowered its forecast for 2014 to 2.7% from 2.8%. We also add that the Bank of Canada lowered its forecast for GDP in the 2nd quarter to 1%, and raised its forecast for the third quarter to 3.8%
Also contributed to the drop in currency declaration governor of the Bank of Canada runners who reported that economic growth in Canada is expected to be "uneven". According to his estimates, the annual GDP growth of 1.8% in 2013 and 2.8% in 2014 and 2015. Furthermore, he added that demand from developing economies is growing. He also expressed his optimism about the prospects for Canadian exporters. In his view, the main domestic risk - the "imbalances in the household sector."
The British pound rose against the dollar after strong labor market data and the minutes of the last meeting of the Bank of England. Also in the course of trade was influenced by comments of Fed Bernanke, who first dropped the value of the currency, and then brought her back to their former positions.
As for the data, is to provide a report from the National Statistics Agency, which showed that in June, the number of unemployed Britons fell by 21.2 million versus 16.2 million a month earlier. It was the strongest decline since June 2010. The number of applications for benefits totaled 1.48 million analysts expected a drop of 8 thousand unemployment rate fell to 4.4% from 4.5% previously, while analysts had expected the index to remain unchanged. The ILO unemployment rate in May remained at 7.8% in line with expectations. Average earnings excluding bonuses rose by 1% versus 0.9% previously forecast and 1.1%. Earnings including bonuses rose by 1.7% vs. 1.3% forecast of 1.4%.
We also add that the protocols presented today showed that all nine members of the monetary policy of the Bank of England in July voted to keep unchanged the existing program to stimulate the economy. At the same time, within the committee remained disagreement over the need for additional incentives. At the first meeting of the Committee on Monetary Policy, chaired by Mark Carney, all nine members of the committee decided not to change the program of buying government bonds. Such absolute unanimity was observed for the first time since October 2012. However, some committee members see the need to increase incentives. They want to understand what tools, in addition to asset purchases, it will be possible to apply under the direction of Carney to boost the economy.
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