American focus: the European currency is trading in a narrow range

The European currency holds tight against the dollar, as many market participants are awaiting the outcome of the Fed meeting, from which investors are waiting for clues on the timing of the program of buying bonds. We add that the markets are waiting for the Fed to clarify the future of the program of buying bonds. The Fed will issue a statement on the results of the meeting, after which the head of the central bank, Ben Bernanke will hold a press conference.

It should be noted that some support for the single currency was data on construction in the eurozone. Construction output in 17 countries in the euro zone rose in April, which was another confirmation of increased economic activity in the region after six quarters of decline. And while in Germany experienced the strongest monthly growth, which in itself is not surprising, there were encouraging signs also have difficulties in southern countries such as Italy and Portugal, where strong growth was recorded for the month. According to published European statistical agency Eurostat data, the volume of construction in April rose by 2 per cent compared to March, when the volume dropped by 1.7 percent.

Compared with April 2012 construction output fell by 6.6 percent. In March, it was noted 7.9 percent decline year on year.

In the EU-27 production in the construction industry in April increased by 0.9 percent in the month dimension, but decreased by 5.9 percent compared to last year.

Among the Member States, the strongest growth in construction compared to March was registered in Germany, Portugal and Italy. In the euro zone the construction of buildings increased by 1.1 percent compared with the previous month, while civil engineering grew by 3.9 percent.

The pound was up against the U.S. dollar, reaching a session high at the same time, amid expectations the publication accompanying statement of the Committee on the Federal Open Market.

It is worth noting that the early fall of currencies contributed to the Bank of England meeting minutes, which showed that the outgoing head of the office with the Bank of England Governor Mervyn King did not find sufficient support in the course of his last vote as a member of the Committee on Monetary Policy in an attempt to achieve increase in size of the stimulus for UK economy.

Mervyn King, David Miles and Paul Fisher argued for an additional 25 billion pounds to buy bonds in order to accelerate economic growth. Considering that new stimulus measures will raise the rate of economic growth without increasing inflation, there is the risk of further shocks from the recession in the euro area, also there is a "need for further monetary stimulus."

But the Committee on monetary policy left the key interest rate of the Bank of England unchanged, at 0.5%, and the amount of retained bond purchase program at 375 billion pounds. According to information contained in the records, the majority of the nine members of the Committee considered the current monetary policy "appropriate."

Minutes of previous meetings give reason to believe that some members have lost faith in the efficacy of the asset purchase program. But the recent volatility of the financial markets have calmed officials that the bond purchases is still effective, records show.

The Canadian dollar was up against the U.S. dollar, which helped to partially presented data that showed that Canadian wholesale sales rose in April, slightly less than expected, as the increase in sales of computers and communications equipment, pharmaceuticals and agricultural products was partially offset by lower costs on motor vehicles and food.

Sales increased a fourth consecutive month, rising by 0.2% to 49,030 million Canadian dollars ($ 48,020 million) reported Wednesday by Statistics Canada. The consensus forecast of analysts was at the level of growth of 0.5%, while the value for the previous month was revised downward to 0.1% from the initial estimate of 0.3%.

Three of the seven sectors, which account for about half of total sales, increased their sales in April.

Sales in the sector of machinery, equipment and supplies were up 2.6%, while sales of computers, communications equipment, and materials jumped by 10.4%.

Sales of medicines, personal and household goods rose by 1.6%. Sales of agricultural supplies jumped 8.9%.

Sales of motor vehicles and parts fell by 1.9%. Wholesale sales of food, beverages and tobacco products fell by 1.4%.

Inventories in wholesale trade in Canada in April rose 0.3% after a revised fall of 0.3% in the previous month, according to preliminary estimates which increased by 0.1%.