The pre-Christmas dollar rally, during which the dollar consolidated at 1.0864 dollars per euro and 1.4740 dollars per pound, will be justified if the strong US labor market statistics for December is published this week. We assume that in December, the US economy will create more than 200 thousand new jobs and the unemployment rate will remain at around 5%. The $1.08 and $1.47 support levels will serve as the immediate objectives of the decline of the euro and the pound.
On January 5, the December inflation statistics for the euro zone will have a significant impact on the euro cross rates. A possible increase in the consumer price index from 0.2% to 0.4% per annum will deliver the best proof for the effectiveness of the regional quantitative easing policy. Despite the weakness of the euro paired with the US dollar, the EUR/JPY pair can close above the 131.5 level according to this week's totals.
A small increase in China's official business activity index in December could support the commodity currencies - the Aussie, the Kiwi and the Loonie early in 2016. In the short term they may consolidate at the US$ 0.738, US$ 0.689 and US $ 0.727 levels respectively.