Euro/dollar slipped below 1.12

At the trading session in Europe, the US dollar is trading in the positive zone. The euro/dollar is losing 23 points compared to Friday's close at 1.1193. GBP/USD fell 60 pips to 1.3068. UK markets are closed for a bank holiday in the country, which leads the cable to low volumes and high volatility.
The US dollar continues to get support from Friday's speech by Janet Yellen and the next increase in US interest rates. The British pound fall against the dollar is stronger than the euro, as the cross-pair EUR/GBP is trading higher.
In the evening US are about to publish reports of expenditures on personal consumption and the index of personal income and costs. These can have an impact on the dynamics of the dollar, if they are significantly higher/lower than the predicted values. If they match with the expectations, there will be no reaction to the news.

The dollar strengthened after the speech of Yellen

Dollar strengthend its position in the course of trading on Friday after the governor of the Federal Reserve Janet Yellen said, that the likelihood of interest rates hike has increased, though not pointed at the approaching of tightening of monetary policy.
The US currency rose after the speech of Yellen, but then turned down, as investors analyzed some of the details of a more peaceful character.
Speaking at a conference of representatives of the world's central bankers in Jackson Hole, Wyoming, Yellen said, that the probability of a Fed rate hike has increased in recent months in connection with improvements in the labor market and the prospects for accelerated economic growth.
The US Commerce Department reported on Friday, that the country's economy in the second quarter of 2016 expanded at a slower pace than previously thought. US GDP grew by 1.1 percent over the same period of 2015, according to revised data. Meanwhile, consumer spending, which make up more than two-thirds of the index of economic activity, showed the strongest growth since the fourth quarter of 2014.

Fed, ECB, Bank of England

Today, it is worth paying attention to the passing in Jackson Hole Economic Symposium, as it meets the majority of the central banks, and will be discussed the world economic situation and the possibility of settlement of the existing problems. It will be accompanied by performances of the FED's governer Janet Yellen, the chairmans of the ECB and BOE. This will undoubtedly lead to a strong volatility in all major pairs.
But often the most important conclusions and statements are not published until its end, so to predict the output of the trade will be problematic. At the moment, the major currencies are in a consolidation phase and are moving in a very narrow range. And it is worth to wait for the release of the more significant macroeconomic data, which will move the market forward.

Jobless claims in the US fell to 261,000, the cuts are scarce

The number of Americans who have filed claims for unemployment benefits last week fell by 1,000 to 261,000, and remained near lows after the recession, indicating that the labor market is healthy and less people lose their jobs.
Economists had forecast jobless claims to total 264,000 in the week from August 14 to August 20.
The average number of new claims for unemployment fell last month by 1250 to 264,000, said the Labor Department on Thursday. Less reluctant average value for four weeks is seen as a more accurate measure of trends in the labor market.
The number of people, filing for benefits in weekly basis, reached 27 year high of 665,000 at the end of the Great Recession in 2009, before starting their long descent. Benefits fell below the key level of 300,000 in early 2015 and stayed there for 77 consecutive weeks, the longest run since 1970.
Continuing jobless claims, meanwhile, fell by 30,000 to 2.15 million in the week, ended August 13. These clims have been reported with a lag of one week and they reflect people, who already are receiving unemployment checks.

USD/CAD rising in anticipation of Yellen speech

On Wednesday, the US dollar was higher against the Canadian dollar, as investors are waiting for the speech of Federal Reserve Chairman Janet Yellen on Friday.
At the beginning of the US trade, the pair USD/CAD reached 1.2953, the session high; the pair subsequently consolidated at 1.2932, adding 0.16%.
The pair was likely to find support at 1.2854, Tuesday's low, and resistance at 1.2997, the high of August 12.
Market participants are waiting for the outlook of Yellen's on US economy, after the hawkish comments of other Fed officials in recent weeks and release of protocols of the July meeting of the Federal Committee, which showed that its members still disagree on the need to raise rates this year.
The US dollar was supported after data on Tuesday showed, that the volume of new home sales jumped by 12.4% to 654,000 last month, although the forecasts were for decline by 2.0%.
Investors remain cautious on the eve of speech of the Chairman of the Federal Reserve Janet Yellen on Friday.
At the same time the Canadian dollar remaind under pressure from falling of oil prices on Wednesday.
Canadian dollar rose against the euro, EUR/CAD fell by 0.18% to 1.4572.

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Westpac recommends selling of pounds around $1.32 to $1.28 and $1.25

Westpac strategists recommend selling GBP at 1.32. They note, that there is a risk a risk of profiting from short positions. However, they say, that the correction of the GBP will likely be short term as the Bank of England took a very flexible position. Regular auctions should emphasize the intention of the Bank of England to cut rates again, which will support the bearish pressure on GBP, analysts say.
The level of economic activity and the housing market in August, which will be published at the end of the month, will likely cause more interest, than the GDP data for the second quarter, as signs of deterioration of the data can trigger further action by the bank of England, say analysts.
The closure of short positions on GBP/USD should allow sales to 1.3200, with the initial target 1.2800, as the more distant target is the psychological 1.2500 level, analysts conclude.