This week was very busy in terms of political, economic, and environmental factors, but before the weekend the situation began to stabilize. The threat of flooding settlements in California, under the Oroville dam declined. Despite the fact that the evacuated citizens are returning to homes, the authorities remain the high alert for a new evacuation mode. Housing Starts in January amounted to 1.25 million against the forecast of 1.23 million. Building Permits for the same period increased from 1.23 million to 1.29 million. Philly Fed Manufacturing Index jumped from 23.6 to 43.3, the forecast was at 18.5.
Before that, in the Eurozone Trade Balance for December in Italy rose from 4.19 billion euros to 5.80 billion euros. But the main event of the last days was a guessing whether the Fed will raise rates in March. Yesterday there was a small burst of activity - the expectations for the average rate fell from 0.705% to 0.69%. Yields on two-year bonds fell from 1,251% to 1,222%. Thanks to these speculative sentiments, which we mentioned earlier, the euro grew by 73 points.
Today we expect a calm trading. Euro-Zone Current Account for December is expected to decrease from 36.1 billion euros to 28.7 billion euros. In the UK Retail Sales With Auto Fuel for January expected to grow by 1.0%. The US CB Leading Index for December is projected to rise by 0.5%.
EURUSD pair has broken through the 1.0620 level, and continued upward movement in the middle of 1.0620-1.0730. We expect a random movement of the single currency in the middle of this range. GBPUSD is trading around 1.2500, the pound is expected to decline to 1.2400.