How Western Capital colonizes Eastern Europe

Another East European country can get a populist, anti-immigration and Eurosceptic government - the billionaire's Andrzej Babis' party ANO has had a significant lead in the polls before the Czech parliamentary elections in October. So the country will be in the company of Poland, Hungary and Slovakia.

If that scares you, you should know that there is at least one protective shaft to extremism in the region - Western European capital, writes in a commentary on Bloomberg View analyst Leonid Bershidski. In fact, Western investment plays such an important role in the economies of these countries that nationalist politicians create their country's image of rebellious colonies rather than partners in a major integration project, he commented. In a recent report, Philippe Novochet, Thomas Picquet, and Gabriel, the East European countries have just been called "foreign-owned countries." "Their owners are usually from EU countries (especially from Germany)," they write and add: "So in a sense, the situation is similar to that in which peripheral areas are owned by more prosperous central areas in a large federal state. " For Piquet and his associates, this is not right because it distorts the measurement of inequalities: much of the wealth of one country accumulates in the accounts of foreign shareholders who are not part of the local richest 1%, so the country appears to be more egalitarian, but it also has a number of wider consequences.

Compared to their economic output, Eastern European countries have the largest negative net investment positions in the European Union, with the exception of Ireland, Greece, Cyprus, Portugal and Spain. The last five have received major rescue packages during the recent financial crisis.  Unlike the hit countries hit by the crisis, eastern European economies have come to these positions after they have long attracted more foreign investment than they have done abroad. Foreign investment in these economies relative to gross domestic product is higher than the average for developed countries.

The countries of Eastern Europe were proud of the high levels of foreign investment, demonstrating their openness and sincere desire to integrate into the richer part of Europe. But when the economic storms hit the EU, these countries realized that foreign ownership also had a price. During the financial crisis, local companies have found that foreign banks are the first to cut lending. In other sectors, large foreign presence would mean high unemployment if the country suddenly becomes less hospitable to foreign capital. In Poland and the Czech Republic, one third of the workforce is engaged by foreign companies.
In addition, they are usually the largest, economically significant companies. In Poland they produce two-thirds of all exports, accounting for 42% of the value added in the Czech Republic. The loss of even a small part of these companies would cause painful reversal of economic trends - something Babysh, as a businessman and former finance minister, understands well. Germany, the Netherlands and France are the largest investors in Eastern European economies. The benefits of investing in the region are clear to companies in these countries - they can cut their labor costs without moving production too far from their traditional markets. Semitic governments can hit foreign banks and supermarket chains with special taxes, as Hungarian Prime Minister Viktor Orban and the Polish government have done, and Babysh will probably do if he gets to power but only to a certain extent - if you overdo it, foreigners can decide to leave.

The Hungarian, Polish and Czech governments refuse to implement EU resettlement allowances and respond in a challenging way when their efforts to control the judiciary are criticized - "We will not be a colony," Orban and the leader of the ruling party in Poland Jaroslaw Kaczynski representatives of the EU in individual cases. However, this will not actually change their status as de facto economic colonies of the richer West unless their populist governments decide to confiscate foreign companies - and that is unthinkable. Czech President Milos Zeman recently said that it might be better to lose European subsidies - such as Western Europe threatens to move - than to be forced to accept Muslim migrants. The real threat, however, is not the loss of subsidies - it would come from the allegations of foreign business from changes in the business climate. The dismantling of cohesion in the EU, and in particular the resistances of the European courts' decisions implementing the Union's policies, over time may lead to it because they would weaken the protection of Western European investors. Orban, who has been in power for longer than his ideological allies in neighboring countries, understands this well - several times he has mitigated his policies as a result of European court rulings. Orban has not directly attacked the latest ruling of the Court of Justice of the European Union, which has obliged Eastern European countries to participate in the Resettlement Block. Nationalist rhetoric may mislead some voters that their leaders are truly independent. But the choice faced by politicians in Eastern Europe is ultimately clear: either they will be satisfied with mostly seeming revolts or they have to raise bets and risk losing the investments that their economies depend on.
In fact, it is not even a matter of choice - after all, Eastern Europe will have to fight for integration, as it once struggled for membership, Bershidskiy said. His personal opinion is that in the end it will not matter where a European company is based because a united Europe will have a common budget and economic cohesion will become inevitable. Nationalism may be gaining power, but it is too late - Eastern European countries have been open to investors for too long and have lost too much control of their economic future to exercise political control.

The Permanent German Chancellor

As Germans go to the polls for Sunday's parliamentary elections, they will also decide whether Chancellor Angela Merkel will be at the top of the country for four years. It has three mandates or a total of 12 years since November 2005, as Germany has no limit on the time this position can take. If she is re-elected (which seems more likely because her party union CDU / CSU is leading in polls with a comfortable lead), she will achieve the achievement of her political mentor, Helmut Kohl, serving for 16 years as Chancellor. In 1990 he even led the German reunion, recalling the site for graphical statistical performance Statista.com.

Only Otto von Bismarck, Germany's first chancellor, occupied this post for 19 years without a single day, from 1871 to 1890. He ruled Germany's initial reunification, turning it from a group of scattered states and feudals into the national the state we know it today. As Germans go to the polls for Sunday's parliamentary elections, they will also decide whether Chancellor Angela Merkel will be at the top of the country for four years. It has three mandates or a total of 12 years since November 2005, as Germany has no limit on the time this position can take. If she is re-elected (which seems more likely because her party union CDU / CSU is leading in polls with a comfortable lead), she will achieve the achievement of her political mentor, Helmut Kohl, serving for 16 years as Chancellor. In 1990 he even led the German reunion, recalling the site for graphical statistical performance Statista.com. The minimum number of seats in the Bundestag should be 598 people. Half of the seats (299) go to candidates selected from party lists. Here is a minimum threshold of 5 percent. The other half of the seats (299) are for candidates elected by the 299 electoral councils, with the principle of one chosen district candidate in force. The winner is the candidate who has achieved the best score, whether he has received 50 percent or no. But the exact number of MPs becomes known after each parliamentary vote. There were 613 deputies in the Bundestag. The sophisticated electoral system allows each voter to vote twice for the same party, or to differentiate his vote by voting for two different political forces, for example a party list of a party that traditionally supports but a candidate of another party , which he considered to be more convincing than the candidate of the traditionally supported party. Most of the Germans vote differently and not in both cases for the same political force because they are accustomed to being governed by coalitions, notes the agency quoted by BTA. The second voice, given as a party list, is of great importance. The result of each party in each German province will determine to a large extent the number of MEPs finally entering the Bundestag, this number being determined by complex calculations. If a party receives, for example, 30 percent of the votes in the proportional vote in a province (or, ultimately, nationally), it will certainly have 30 percent of all its seats. If the number of MPs elected by direct vote turns out to be below that threshold of 30 percent, then it is supplemented by candidates from the regional lists. However, if the number is higher than the proportional result (which is increasingly the case for the two largest parties - the Conservatives and the Social Democrats), these direct additional seats remain and mechanically increase the total number of MPs in the Bundestag. In this case, the Constitutional Court imposed a rebalancing of the forces in the form of providing additional seats to other small parties in order to preserve the proportional dimension of the vote. This ultimately leads to a swell in the number of MPs in the Bundestag and, according to estimates, this time it could reach 700 deputies. Attempts to have a ceiling on this number have so far failed.  The electoral system is such as to exclude too small parties from parliament, the DPA notes. As a result, a party must transfer the threshold of 5 percent of the national vote or beat three electoral districts. The 5% barrier does not apply to parties representing national minorities. For decades, the German electoral system has not produced an absolute majority for a party. The country has no tradition of forming minority governments, so the next government will be an inalienable coalition, AP notes. The election day tomorrow begins at 8am local time and ends at 6pm local time. Recent public opinion polls show that the Conservative bloc Christian Democratic Union / Christian Social Union (HDZ / HSU) of Angela Merkel will receive 36 percent. The German Social Democratic Party (GDS) will receive 21.5 percent. An alternative to Germany, defined as a populist and anti-immigrant, will get 11 percent (AG). Liberals from the Free Democratic Party (SDP) will receive 10 percent, Lewis - 8.5 percent, and Greens - 8 percent. In the 2013 election, 24.3 percent of voters sent their ballots by mail. It is expected that the record in this direction will be improved. In the current election, 4800 candidates are taking part. Of these, 29 percent are women. The average age of the candidates is 47 years, the youngest being 18, and the oldest is a 89-year-old German actress and publisher, author of children's and gourmet books and political actor Barbara Reutting. There are 42 parties in the election, with 16 of them taking part for the first time. Among the recruiting parties are the Basic Basic Income Union, the German Center Party and the Party of Change, the vegetarians and the vegans. Out of the total of 42 parties, only four were represented in the current parliament, and they are the HSU / HDZ, the SGP, the Lefti and the Union 90 / Greens, united more than 20 years ago with the two separate parties - Union 90 and Greens. Election candidates may be elected by parties or be independent. In the latter case, the independent candidate must submit 200 signatures in its support. So far, there have been only three times early elections in Germany in 1972, 1983 and 2005, TASS added. Elections are generally produced at four years and the date is set by the president.
Tomorrow, residents of the capital will combine the vote in the parliamentary election with the traditional Berlin marathon and vote in a referendum on the fate of Berlin's Tegel Airport - whether to continue operating parallel to a new airport or to stop work, the DPA recalls.

These new bubbles threaten the economy

This system has once brought the world economy to the brink of the abyss: loans to millions of Americans for things many can not afford, with collateral whose value is often questionable, bound and resold to hungry for investors. Ten years after the unexpected collapse in real estate prices in the US first sparked the subprime mortgage crisis and then the global economic crisis, Subprime credits are again flourishing - in other words - low-rated loans and high interest rates. This time, however, mortgages are not worrying about observers. The debt of Americans grew particularly fast in three other areas, an analysis by N-TV Max Borowski writes.

Car loans

With a total volume of 1.1 trillion. dollar unpaid loans, American carmaker debt obligations reached a record level. About 107 million Americans, nearly every second elderly American, are currently paying car credit. A large part of these loans are rated "risky" or "high risk", ie with bad or particularly bad credit ratings. Will this bubble burst?

Credit cards

And as far as credit card debt is concerned, Americans would have their previous record before the financial crisis this year, with the debt amounting to the threshold of 1 trillion. dollar. Some observers see this as a good sign of the economy, as US citizens are clearly confident in their financial situation and persistently consume. Are we afraid of bursting the bubble? Most banks currently do not see any cause for concern. While unemployment is at the lowest historical level, they do not expect big losses. In addition, US households are currently spending less than ten percent of their debt servicing income, which is significantly lower than in previous years. But there are some warning signs: the American bank Wells Fargo recently lowered its outlook on card debts as the credit criteria were downgraded to an alarming extent.
What consequences would a burst of credit card bubble have? American banks are already aware of the painful bad debt on credit cards. During the previous crisis, they had to write off 100 billion dollars. Additionally, credit card lending is crucial for the US economy. If banks begin to refrain from doing so, this could hinder consumption and thus 0 of the whole economy. 

The rate of non-payment for car loans is relatively low, but rises above all in pp. Subprime segment. In addition, maturities are becoming longer - a sign that banks are constantly reducing their  customer requirements. Several aspects of the auto credit boom remind the practitioners of the practices before the mortgage crisis. According to numerous reports, some of the creditors are extremely careless. Thus, in many cases, debtors' creditworthiness is not considered. Many loans are obviously based on false information about assets and income from customers. This means that the proportion of bad loans can be significantly larger than the official one. The purchased vehicle is in most cases used as the sole guarantee for many car loans. However, in the event of a default, the resale value of the car is often found to be lower than the remainder of the loan. As a result, the client falls into a debt trap and the creditor can not collect some of his money. What consequences would a car bubble burst? More than 1 trillion. dollar credit volume of which more than $ 200 billion has a bad credit rating: these are huge sums, but not paying much of the car loans will not trigger a new global financial crisis. For comparison, before the financial crisis, US banks were selling mortgages for over $ 3 trillion a year. Some investors, however, can suffer serious losses. High risk loans are particularly popular at the moment as they have a relatively high interest rate of about five percent per year. Many of some earlier lenders combined their car loans and, together with the risks, sold them to investors.  Moreover, the debt pyramid is a problem for the automotive industry. Demand in the US drops. More loose lending, however, still keeps high-level car sales. But without credits, sales of new cars on the crowded market will collapse.

Student credits

Faster than credit card loans and car payouts in recent years, US student debts are rising. With an average of $ 34,000, university graduates are leaving university. Total student loans amount to about $ 1.4 trillion.
More on the topic

Americans prefer debit cards to credit cards

Can the balloon burst? To some extent, this has already happened. About 8 million Americans out of a total of 44 million with student loans fail to meet their obligations. This corresponds to a share of 18 per cent. Only a third of former students manage to repay their credits on time and without state or state support.
What consequences would a burst of student dollar bubble burst? In any case, it will be expensive for US taxpayers. If, prior to the latest financial crisis, student loans were mainly provided by banks, then 90% of new student loans are provided by the Ministry of Education. Thus, the state carries the bulk of the default risk. Moreover, the over-indebtedness of many graduates is becoming a problem for the economy as a whole and for society. Because of the higher weight of these student loans, fewer young Americans buy houses, furniture and other household goods than ten years ago. The American media even finds a link between increased indebtedness and the increasing incidence of depression and problems in young family relationships.

Russia - a standard of economic weakness

If we look at the state of the Russian economy, it turns out that Russian power is quite fragile. Clearly the only thing that has to worry about the West is that the collapsing oligarchy in Russia does not cause a nuclear conflict. Nowadays, executives of Russian destruction orders, North Korea, use outdated Russian developments to gain recognition as a world power, however ridiculous it may seem, against the backdrop of their real state. The macroeconomic picture and the investment potential of the Russian economy are becoming more and more serious in the field of analysts and the media. Indeed, Russia has never been able to boast of a particular economy based on the production of other than natural resources. Among the main reasons are geopolitical interventions by President Putin and the deep collapse of international oil prices. In 2015, Russia's GDP declined by 3.7%, and the IMF forecast for 2016 is for a further decline of 1%. A return to economic growth is not expected until 2018, but this is unlikely. Such forecasts show that the current crisis has a more structural dimension than the 2008 oil crisis and the 1998 public finances crisis in Russia In both cases, the recovery started after only one year or at most two.

The Russian economy is initially weak

It is important to know that whatever Russia claims, the economy is over six times weaker than the US economy. At present, even South Korea has a stronger economy than Russia. The only economic boom that has experienced Russia in recent years is the leap in oil prices over $ 100 a barrel, which has not happened for a long time. The economy of Russia depends on 70% of the price of oil, which is now also detrimental to it. To the mime, the "black days" fund that the Kremlin formed in 2000 is exhausted and things for Russia become too dangerous.

Oil - the leaking blood of the Russian economy

It is no secret that the Russian budget is largely dependent on government revenues from oil and gas products. It is not surprising that the sharp impact of the oil price collapse on the budget and on the development of the entire Russian economy. Revenues from the sale of oil and gas products account for nearly 50% of the country's budget over the past 10 years. This revenue also accounts for 70% of total export revenue and 25% of total GDP. The continuing dependence on exports of energy commodities is evidence of the failure of President Vladimir Putin's attempts to diversify the Russian economy - intentions he declared 15 years ago. In April 2001, ahead of the Russian Duma, Putin sharply criticized the fact that the Russian economy was heavily dependent on oil revenues and said the main task ahead was a massive diversification policy. To date, there is no change in this direction. An apparent manifestation of Russia's large economic dependence on oil revenues is the logical collapse of the Russian ruble. The strong positive correlation between the price of oil futures, Brent varieties with delivery on March 16 and the ruble spot versus the dollar is evident in the first chart. Russian money reached a record depreciation on January 21, when it touched 86 rubles per dollar.

The high cost of geopolitics

The shifts in the geopolitical chessboard also had their reflection. The Russian currency collapsed almost twice since the Crimea's annexation in March 2014 and the subsequent US and EU sanctions to date. Devaluation of the ruble resulted in a 13-year peak in inflation in the country to 16.9% in March 2015. By comparison, in April 2012, inflation was at 3.60 per cent. In the years following the annexation of the Crimea and the start of the war in Ukraine, the number of people living below the poverty line reached 23 million people. The meltdown of foreign exchange reserves is also a logical consequence of the outflow of capital from Russia and the worsening of the overall macro picture in the country. The government and the central bank tried to stop the galloping depreciation of the ruble, but as is often the case, the effect of the interventions has turned out to be a reverse sign. One example was the intervention by the central bank on December 16, 2014, when the ruble to the dollar went up to 80 rubles per dollar. Then the governor of the Russian central bank Elvira Nabiluna decided to raise the interest rate by the remarkable 6 percentage points. The effect of melting foreign exchange reserves is clearly visible in the second chart. In 2014, Russian currency reserves melted by $ 150 billion. On January 21, 2016, at the last bottom of the ruble, Nabiulina silenced the financial audience, saying the bank would not react to this collapse, as it did in mid-December, because the ruble was close to its "fundamental levels" . The statement comes at a rate of nearly 82 rubles per dollar. A strange and dangerous strategy to soothe the market. Whether Russia is beginning to ripen the idea of ​​printing rubles is difficult to assume in response to the crisis. One thing is certain: if this happens, the purchasing power of Russian households and firms may be even more endangered. Even so far, the budget problems and the highly depreciating ruble have led to a decline in wage levels and a decline in consumer demand.

The strong depreciation of the Russian ruble hit mainly Russian citizens who are increasingly struggling to maintain their current consumption levels. The economic phenomenon of stagflation is already a fact of Russian land. We are experiencing both a decline in aggregate production and a rise in prices. Of course, we make the statement that the third main indicator in the stagflation grip, high unemployment, is relatively low for now. However, in view of the decline in the last few months of the working Russian population, the outlook for the labor market does not look positive.

Future threats

One of the main dangers to Russia's fiscal stability is the premise that budget deficits become chronic and thus increase the debt burden of the state. The originally planned 2016 budget is based on average prices of $ 50 a barrel (just under 30 at the moment), so the potential for the deficit this year to exceed the 3 percent of GDP previously is very high. Analysts from the RBC predicted that if oil prices dropped to $ 24 a barrel, then the budget deficit could swell to 7.5 percent of GDP.

It is noteworthy that the cost of military targets reaches record levels relative to general government spending in the context of the ongoing interventions of the Russian Army in Syria. This is an aggravating factor for the financial health of Russian public finances. We have seen similar actions and their subsequent effects less than two years ago. Following the escalation of the conflict in Ukraine and Putin's intervention, military spending has increased more than twice. Russia's average military costs for February, March and April 2014 amounted to 6.7% of GDP and 27.7% of total government spending.

Financing of deficit spending is a delicate issue in view of the relatively high interest rates on Russian debt in Russia and the indulgence of domestic agents for financing larger government securities issues. At present, public debt to GDP is about 14%, which is one of the lowest levels globally. The reasons for these low levels, however, lie in the indolence of foreign investors to buy Russian government securities. The prerequisites for such moods are the memories of the financial year 1998-1999, as well as the active role of Russia in the Ukrainian conflict in February 2014.

Evidence of the great likelihood of a serious budget deficit being inflated for the current 2016 is the Russian Finance Ministry's February 5th action. Financial authorities in the country have announced that they are probing the possibility of placing eurobonds on international markets. Russia's last foreign funding was in 2013, before the escalation of the conflict in Ukraine and the imposition of the first-stage sanctions by the EU and the US. Concerns about the slow exit of this situation are related to the objective assumptions that Putin has no vision and intention for structural reforms. The only rescue belts are the rise in international oil prices and the lifting of sanctions that have interrupted the access of key government-controlled companies (in the banking, energy and military industries) to international debt markets. These belts, however, do not seem to be close to Russia's outstretched hand. Reforms are needed to focus on more investment in technology production and the government loopholed around the door of private initiative. However, the complicated geopolitical situation poses too many risks to the Russian economy - pressure on the budget stemming from low oil prices and increased military engagements, the ruble loses its worth, and debt financing is limited. Against all this, the Russian economy does not seem ready for further exacerbation of the conflicts. The paradox is that precisely the steps that would help in the long run can quickly quench Putin's high rating in the eyes of Russian citizens.

Daily analysis of major currency pairs for September 4, 2017

European stocks closed with rallies for a third consecutive session on Friday, helped by the news that the European Central Bank will probably wait for December to unveil a plan to cut asset purchases.

The weaker-than-expected US job data also helped stimulate the positive mood of the stock markets as it reduced the likelihood that the Fed would raise interest rates again this year. Stoxx Europe 600 finished 0.6% up to a closing price of 376.14, recording 0.6% weekly growth. The European benchmark rose 0.8% on Thursday but still recorded a loss of 1.1% in August, marking a third consecutive month at a loss. On Friday, US stocks ended the week and the first trading day in September as profit as weaker-than-expected job rises could lower the Federal Reserve's desire to increase credit spending for 2017.

Dow Jones Industrial Average reported a 0.2% growth to 21,987.56, helped by General Electric Co., Chevron Corp. and Nike Inc., recording a weekly increase of 0.8%. The S & P 500 ended with a 0.2% rise, supported by the energy, commodities and finance sectors, registering a weekly 1.4% growth. Technological Nasdaq Composite Index rose 0.1% to a closing price of 6,435.33 points after briefly falling into negative territory. The index recorded a weekly profit of 2.7%, taking into account the biggest growth in December.

EUR / USD

The single currency recorded a decrease against the US dollar on Friday. The session started at 1.1909 and the euro bounced off the resistance at 1.1910. After a volatile session, the currency pair ended at 1.1864. If the pair continues to move down, we can expect a test at levels around 1.1735. On the upside, the euro will focus on the resistance at 1.1910.

Support: 1.1735; 1.1670;

Resistance: 1.1910; 1.2080;

GBP / USD

The British pound recorded a modest rise against the US dollar on Friday. The currency pair opened at 1.2928 and the pound added 26 pips. The chart continued to grow above the creeping averages, while the relative strength index remained neutral. If the upward direction persists, the pair will probably break the first resistance at 1.2980.

Support: 1.2840; 1.2780; 1.2700;

Resistance: 1.2980; 1.3100;

USD / CHF

On Friday, the US dollar recorded a volatile session against the Swiss franc. The currency pair opened at 0.9585 and finished 60 pips higher. Daytime extreme values ​​were reached at 0.9546 and 0.9652 respectively. If the bullish mood continues, there will probably be a breakthrough in the first resistance at 0.9700.

Support: 0.9555; 0.9450;

Resistance: 0.9700; 0.9760;

USD / JPY

The US dollar recorded a modest rise against the Japanese yen on Friday. The session started at 109.97 and finished 28 pips higher. The chart continued to grow above the creeping averages, while the relative strength index remained neutral. In the short term, positive moods prevail, with indicators going over their average lines.

Support: 108.80; 107.80;

Resistance: 110.20; 110.90;

* This material does not constitute a recommendation for the purchase / sale of securities.

Analysis of major currency pairs for September 1

European stock markets rose on Thursday thanks to better data on industrial production in China. On the other hand, some traders' shares have experienced difficulties after the French chain Carrefour SA warned of worse results. "Let's not be fooled. Tensions between Pyongyang and Washington still reflect the market, but as long as relations are in relative stagnation, bullying will continue to prevail. Now traders take advantage of lull and gain strength, but the momentum of the stock will hardly last long, "said David Madden, market analyst at CMC Markets. Stock exchanges in Europe have recently been defeated by the stronger euro, which hit nearly a 2-year high against the dollar and an eight-year high against the British pound. A strong euro should be a warning flag for the European Central Bank. Thus, it may terminate the asset buyout program, but this will happen at a slower pace. Anonymous sources told Reuters. 

According to Eurostat preliminary data, inflation in the Eurozone should have increased by 1.5 percent in August. US stocks advanced on Thursday and the main indices recorded fifth consecutive monthly growth. Meanwhile, the rally of the biotech companies has fired Nasdaq Composite at record levels. Earlier in the day, the better financial results of some companies raised the mood of Wall Street. According to a large number of analysts, the markets are still reflecting the positive performance of the business and the emerging economy over the past few months. The lower number of applications for unemployment benefit suggests that the labor market continues to recover. On the other hand, consumer spending, which is the most important engine of the economy, rose in July due to higher incomes due to the summer tourist season and low. The euro marked a volatile session against the dollar on Thursday. Eventually, the pair remained at the higher levels of the previous day. If the bullish moods continue to prevail, the resistance at 1.2102 will be tested soon. Trading started at a price of 1.1802, with the bearish trend leading. After the bottom of the day was hit at 1.1822 the direction changed and the final was put at a price of 1.1909.

Support: 1.1735; 1.1670;

Resistance: 1.2102;

GBP / USD

The pound recorded a second consecutive dynamic session against the dollar on Thursday. The pair is still close to the resistance at 1.2965 and if the British currency justifies the positive expectations, the key level will be overcome soon. Trading on Thursday was open at 1.2924, and the final was just 5 pips higher. The trend was volatile, as early as the bearish sentiment prevailed and the currencies hit bottom at 1.2852.

Support: 1.2769; 1.2722;

Resistance: 1.2989; 1.3030;

USD / CHF

The dollar lost positions against the Swiss franc on Thursday. The US currency broke the positive momentum of the past two days. The session started at a rate of 0.9632 and the final line was truncated 47 pips up. The trend was volatile, at first the bulls prevailed, and the pair made a resistance test at 0.9697, recording a peak at 0.9679. The dollar then collapsed.

Support: 0.9387;

Resistance: 0.9697; 0.9771;

USD / JPY

The dollar broke the two-day defeat against the yen on Thursday. The sessions were opened at a price of 110.23, at which time the bulls continued the positive trend. But around noon, the direction changed sharply, and the US currency lost the lead. So the bottom was hit at 109.87, and the final was 9 pips up. If the bearish sentiment remains, the currencies will test the support at 108.62.

Support: 108.61; 108.28;

Resistance: 110.94;