The past week in the currency markets was marked more by consolidation than decisive moves, even as risk aversion deepened in US stock markets. Dollar’s selloff slowed and turned into a modest recovery, but there was no clear momentum for bullish trend reversal. Sentiment remained fragile, weighed down by constantly escalating trade tensions and the…
Markets EUR/USD’s stellar rally over the last couple of days ran into resistance recently. After hitting 1.09 for the first time since October of last year, it is trading around 1.085 currently on a combination of both euro weakness and dollar strength. We spotted a few drivers, including a special session in the outgoing German…
A 25 basis point cut to the ECB deposit facility rate is widely anticipated, marking the seventh cut in the current cycle. The ECB continues to cut rates amid slow Eurozone growth, while the Federal Reserve pauses, creating a notable divergence in monetary policy. What next for EUR/USD? A 25 basis point cut to the…
Markets “Whatever it takes.” These words by former ECB president Draghi in July 2012 are widely considered the turnaround in the sovereign debt crisis that had the euro (area) staring into the abyss. Germany’s upcoming chancellor Merz used them again to announce a similar seismic shift on a fiscal level. With a €500bn infrastructure investment…
Eurozone producer prices rose sharply by 0.8% mom and 1.8% yoy in January, exceeding expectations of 0.3% mom and 1.4% yoy, respectively. The monthly increase in Eurozone PPI was primarily driven by a 1.7% mom jump in energy prices, while capital goods and durable consumer goods also saw notable gains of 0.7% mom and 0.6%,…
The euro has extended its gains on Tuesday. EUR/USD is trading at 1.0523 in the North American session, up 0.36% on the day. Earlier, the euro rose as high as 1.0559, its highest level since December 10. Eurozone unemployment remains at 6.2% The eurozone economy is sputtering but there’s nothing wrong with the employment picture….
Markets Higher-than-expected European inflation numbers and more rumours on fast and huge fiscal spending in Europe weighed on European bonds with curves bear steepening. February inflation rose by 0.5% M/M (vs 0.4% consensus) with the annual number moderating from 2.5% to 2.4% instead of the hoped-for 2.3%. Core CPI picked up to 0.6% M/M and…
Markets Event risk looms large this week as narratives unfold at similar levels. We therefore continue to err on the side of caution, favoring traditional haven assets. First, there’s the US growth story. Markets turned more sensitive to risks of a US growth slowdown or even recession as US President Trump’s policy mix (going from…
EUR/USD gains as the latest US PCE inflation data aligns with expectations, easing concerns over unexpected US inflation spikes. A slight increase in US Treasury yields could help limit the downside of the US dollar. Traders look to the Eurozone HICP inflation data for further direction ahead of Thursday’s ECB policy decision. EUR/USD pauses its…
Germany goes to the polls, but far-right AfD unlikely to form government. German CPI data might be bigger driver for the Euro. US inflation also in the spotlight as PCE report awaited. CPI releases in Australia and Japan, Canadian GDP also on tap. Will German elections change the outlook much? When Germany’s chancellor, Olaf Scholz,…