The Euro Gains as the USD Slips Post ECB and FOMC


The Euro has shown an uptick as the market digests the outcome of the ECB. The currency gained on the back of the USD’s slip through the Asian session as markets accepted the ECB hike and Federal Chair Jerome Powell’s comments overnight.

The market widely anticipated the 75 bp rate hike by the ECB, and they were not disappointed. President Christine Lagarde provided language in the post-meeting press conference, making markets believe that another 75 bp will be coming up.

Federal Reserve Chair Jerome Powell also re-affirmed his stance on fighting inflation, hinting at the Fed’s possibility of another outsized hike at their next meeting.

The recent rise in USD/JPY toward 145 has ushered in an era of berating from Japanese officials. Finance Minister Shunichi Suzuki and Bank of Japan Governor Haruhiko Kuroda are in control, expressing ‘concern about the rapid and one-sided move.’

The Australian Dollar has gained despite comments from the RBA hinting toward a deceleration in rate rises going forward. Oil and gold have found firmer footing in this environment. The WTI futures contract is approaching US$ 84 bbl, while the Brent contract is nudging toward US$ 90 bbl. Gold is back above US$ 1,720.

Chinese inflation data divulged a decrease in price pressures, with August year-on-year CPI at 2.5% instead of 2.8% expected and PPI way below forecasts of 3.2%, coming in at 2.3%. USD/CNY is lower today, back below 6.9400.

APAC equities have followed on from a positive Wall Street lead with all markets in the green. Futures indicate a positive start to the European and North American cash sessions.

Canada will see jobs data after French industrial production figures today.

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  1. Suivre Téléphone

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