We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site.

Free Trading Guides
EUR/USD
Bullish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
Oil - US Crude
Mixed
Wall Street
Bullish
Gold
Mixed
GBP/USD
Bullish
USD/JPY
Bullish
More View more
Real Time News
  • Forex Update: As of 20:00, these are your best and worst performers based on the London trading schedule: 🇪🇺EUR: 0.91% 🇳🇿NZD: 0.64% 🇨🇭CHF: 0.59% 🇬🇧GBP: 0.17% 🇨🇦CAD: -0.02% 🇯🇵JPY: -0.23% View the performance of all markets via https://www.dailyfx.com/forex-rates#currencies https://t.co/j3MpbrNtG4
  • RT @SecPompeo: I applaud @Nasdaq’s actions to require all listed firms comply with the same auditing and inspection rules, especially as re…
  • Commodities Update: As of 20:00, these are your best and worst performers based on the London trading schedule: Gold: 0.88% Silver: 0.43% Oil - US Crude: -0.31% View the performance of all markets via https://www.dailyfx.com/forex-rates#commodities https://t.co/s7unTde0G5
  • The #FTSE 100 surged to its highest level since early June on Wednesday after the equity index pierced a longstanding technical barrier around 6,200. Get your #FTSE market update from @PeterHanksFX here:https://t.co/uFaYFaPGz2 https://t.co/mNnlGDksJn
  • IG Client Sentiment Update: Our data shows the vast majority of traders in Ripple are long at 97.30%, while traders in US 500 are at opposite extremes with 76.93%. See the summary chart below and full details and charts on DailyFX: https://www.dailyfx.com/sentiment https://t.co/kZcqWecOdG
  • The $EURUSD's climb continues at an exceptional pace. It is on course for the biggest three-week rally since May 2015 (the bottoming after the 2014 collapse) https://t.co/AbDLQ07D95
  • ECB's Lagarde says we are at low point of this crisis today - BBG
  • US Treasury Yields: 2-Year: 0.194% 3-Year: 0.250% 5-Year: 0.400% 7-Year: 0.633% 10-Year: 1.393% 30-Year: 1.626% $TNX
  • Wonder when this’ll reverse 🤔 Highly recommend checking this piece out ⬇️ https://t.co/lrQDt3oLDZ
  • Indices Update: As of 20:00, these are your best and worst performers based on the London trading schedule: US 500: 0.02% FTSE 100: 0.01% Wall Street: 0.01% Germany 30: -0.09% France 40: -0.22% View the performance of all markets via https://www.dailyfx.com/forex-rates#indices https://t.co/lVtLGVVPJs
ECB Speculation Pushes Fed Out of the Spotlight

ECB Speculation Pushes Fed Out of the Spotlight

2016-03-07 09:42:00
Ilya Spivak, Head Strategist, APAC
Share:

To receive Ilya's analysis directly via email, please SIGN UP HERE

Talking Points:

  • Euro, risk trends hinge on whether ECB satiates markets' thirst for stimulus
  • BOC rate decision likely a non-event as Poloz waits for details of fiscal plan
  • NZ Dollar volatility to follow RBNZ policy meeting on evolving rate cut bets

After weeks of preoccupation about the trajectory of Federal Reserve monetary policy, the markets will shift their gaze to the European Central Bank. President Mario Draghi and company are expected to deliver at least another 10 basis point cut to the deposit rate, pushing it deeper into negative territory.

The supply of global monetary stimulus has been a major driver of market-wide risk appetite trends, with shares tracking a broad-based measure of market liquidity. With that in mind, the ECB's policy stance is likely to have implications beyond the Euro and fuel volatility across the spectrum of benchmark assets.

If the ECB delivers pushes the deposit rate to -40bps as is already reflected in forward pricing, investors are likely to be disappointed. Subsequent price action is likely to mirror what happened in December when a similarly pre-telegraphed move failed to inspire enthusiasm.

A truly big-splash gesture would require not only a deposit rate cut but also an increase in up-front QE, increasing monthly purchases from the current rate of €60 billion/month. If this is delivered alongside the rate reduction, the Euro is likely to decline alongside the likewise anti-risk Yen while high-yielding FX such as the Aussie and Kiwi Dollar risk with share prices.

Policy announcements from the Bank of Canada and the Reserve Bank of New Zealand are likewise on tap. The former may be a non-event: Canadian economic data has continued to improve versus expectations since January's BOC meeting and Governor Steven Poloz seems unlikely to abandon wait-and-see mode until the government's fiscal plans are unveiled later this month.

The latter may stoke volatility however as traders comb through the policy statement for clues about when the RBNZ may resume interest rate cuts. Markets price in at least one 25bps reduction and see an 82 percent probability of a cumulative 50bps in easing over the coming 12 months.

--- Written by Ilya Spivak, Currency Strategist for DailyFX.com

Contact and follow Ilya on Twitter: @IlyaSpivak

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES

News & Analysis at your fingertips.