Forex: Wednesday results.[E]

USD set to gains on Wednesday. The main gains were made while American
session after US INT. Trade. While analysts predicted deficit
growth approximately to $64.6 bln. in May, data of Commerce Department
showed deficit increase just to $63.8 bln. against $63.4 bln. in April.
The yen has sharply slide down against the dollar and fell versus the
euro as traders pared bets the BOJ will raise interest rates more than
once this year. Japan's Finance Minister Sadakazu Tanigaki said today
there's no need" for the BOJ to rush to raise borrowing costs. Remind
that two days before the central bank was likely to lift its key zero
rate for the first time in six years. The yen advanced 2.9% against the
dollar this year as the central bank prepared to abandon its zero-rate
policy.
Britain data promoted to decrease of the pound. The number of people
claiming jobless benefits climbed in June to its highest levels since
January 2002.
Average wages including bonuses lifted in March-May more than analysts
expected. Acceleration of wage's growth is a signal of inflation
pressure.
Eurozone GDP didn't missed forecasts in Q1 2006. At the same time EU
commission said it expects EU GDP growth 0.4-0.8% q/q in Q2 2006,
0.3-0.7% - in Q3 and 0.5-0.1 - in Q4.
As a whole, EU commission awaits GDP growth on 2.1% q/q in 2006.
However this week EU officials don't exclude the increase in September.

EUR/USD after consolidation in a range $1.2755/70 started to drop to
the session low $1.2711. Bids became the reason of recoil to $1.2730.
Then decrease has proceeded, therefore the level $1.2670/80 has been
tested. Bids urged recoil. Day was closed on $1.2700.
GBP/USD while trades dropped from $1.8480 to $1.8380 then it was
stabilized in area $1.8390/1.8400. Then decrease has proceeded, and the day
time low has been made on $1.8311. As a result of recoil the rate has
raised in area $1.8350 where finished trades.
USD/JPY after consolidation in a range Y114.20/40 started sharply
raise overcoming Y115.00 to the high Y115.69. Followed recoil was moderate
and the trade closed on Y115.45.

US structural problems led to USD drop in 2004. But in 2005 the dollar
could cover prior year losses and firm 13% versus EUR in an annual
average. USD gained on renewal speculations FOMC rate hike every meeting.
The last benchmark rate lift to 5.25% was on June 29. This years USD
upside pace was amid speculations FED will take a pause in it's policy
tightening and ECB will against raise it's rates to lower borrowing costs
gap between two huge economies. Thus EU will lure more investments
tasking US assets to it's gains.