By Javier Paz, ForexDatasource.com The following is an extract of the weekly euro and sterling report available for free at the ForexDatasource blog Euro – Current Scenario As we expected, the dovish comments from ECB VP Papademos set the tone for a bad euro week (down 3.0%). The temporary euro boost from the BoE rate [...] [...more]
EURO Report Current Environment The weekend comments from ECB VP Papademos (ECB to “act appropriately” in slowdown) is the second signal in 7 days that ECB members are open to rate cuts in contrast to comments from ECB President Trichet. Opportunistic traders have speculated that the overnight yield advantage of the euro alone could support [...] [...more]
We should avoid reading too much for or against the euro over the events of this past week. Clearly, the strong euro rally appears to be on hold. We believe that dovish comments from an ECB councilmember plus weaker than anticipated data out of the EU and Germany this past week weakened the enthusiasm of euro bulls. Our analysis does project modest euro gains against the dollar for the week. [...more]
A perception that the EURUSD has bottomed is floating around. The logic for this theory is that the EU zone economy is showing less strains than the US economy. Add to that the words from Trichet who drew a line on the sand indicating a virtual end to the ECB rate cuts. The euro is ripe for a pullback around 1.31 but the lack of major EU economic news may give enough momentum to challenge this key resistance. [...more]
The European Central Bank has lowered interest rates with 75 basis points to 2.50%. This is the largest rate cut in its history, though it must be noted that the bank is only 10 years old. The primarly objective of the ECB is to maintain price stability. Because of the fast dropping oil prices, inflation [...] [...more]
