- Australian employment beats but Aussie cant break 1.0500
- Risk FX very quiet ahead of Central bank meetings
- Nikkei 0.85% Europe 0.91%
- Oil $88/bbl
- Gold $1693/oz.
North America:
EUR/USD
When the ECB last met in November, Mario Draghi said he does not expect any major improvements in growth over the next year but more stimulus was not necessary because the availability of OMT has been enough to stabilize the financial markets and reduce bond yields. We don’t expect his views to have changed especially since Spanish 10 year bonds are now yielding 5.382% down from 5.836% the last time the ECB met. The central bank has made it abundantly clear that they are satisfied with the market’s reaction to OMT and the current level of monetary policy and we believe they will remain committed to providing unlimited liquidity. Since we don’t expect Draghi to say anything new, this month’s monetary policy announcement and accompanying press conference may have a limited impact on the EUR/USD.
EUR/USD