Back
4 Dec 2014
EUR flat after ECB leaves rates unchanged – Scotiabank
FXStreet (Barcelona) - Camilla Sutton CFA, CMT, Chief FX Strategist at Scotiabank, believes a lot of negative news has already been priced in the EUR as it trades flat after ECB leaves rates on hold at 0.05%.
Key Quotes
“EUR is flat after the ECB as expected left interest rates on hold at 0.05%. The excitement for EUR and bond markets is President Draghi’s comments and the release of the updated economic projections. There is a lot of EUR negative news priced in.”
“The ECB forecasts will include the outlook for 2017 (new) but also likely to see a downgrade to both 2015 and 2016 growth and inflation. Currently, the ECB is on the high‐end of both and accordingly will likely bring their forecasts closer to consensus. The market should be well prepared for this.”
“President Draghi’s press conference will be scrutinized for hints that the ECB is preparing to launch a broader asset buying program in 2015. At the May press conference, President Draghi commented that “the Governing Council is comfortable with acting next time”, which weighed heavily on EUR.”
“Fundamental news from Europe was mixed today, with France’s unemployment rate unexpectedly rising to 10.4% but rising retail PMIs in Italy, Germany and the broader Eurozone. We expect EUR to trend lower over time; holding a 2015 year‐end target of 1.18.”
“EURUSD short‐term technicals: bearish—will most signals warning of renewed downside pressure. The RSI at just 36, leaves significant downside room before the currency has reached oversold levels.”
“Spot has dropped to fresh lows, the MACD has generated a sell signal and the trend is downward. We are biased to trade with the downward trend. Support lies at 1.2280 followed by 1.2200; while resistance comes in at 1.2383—yesterday’s open.”
Key Quotes
“EUR is flat after the ECB as expected left interest rates on hold at 0.05%. The excitement for EUR and bond markets is President Draghi’s comments and the release of the updated economic projections. There is a lot of EUR negative news priced in.”
“The ECB forecasts will include the outlook for 2017 (new) but also likely to see a downgrade to both 2015 and 2016 growth and inflation. Currently, the ECB is on the high‐end of both and accordingly will likely bring their forecasts closer to consensus. The market should be well prepared for this.”
“President Draghi’s press conference will be scrutinized for hints that the ECB is preparing to launch a broader asset buying program in 2015. At the May press conference, President Draghi commented that “the Governing Council is comfortable with acting next time”, which weighed heavily on EUR.”
“Fundamental news from Europe was mixed today, with France’s unemployment rate unexpectedly rising to 10.4% but rising retail PMIs in Italy, Germany and the broader Eurozone. We expect EUR to trend lower over time; holding a 2015 year‐end target of 1.18.”
“EURUSD short‐term technicals: bearish—will most signals warning of renewed downside pressure. The RSI at just 36, leaves significant downside room before the currency has reached oversold levels.”
“Spot has dropped to fresh lows, the MACD has generated a sell signal and the trend is downward. We are biased to trade with the downward trend. Support lies at 1.2280 followed by 1.2200; while resistance comes in at 1.2383—yesterday’s open.”