European Central Bank Posts on Forex Blog
Italian GDP Sends European FX Lower
Aug 8, 2008
Italy, the 3rd largest economy in the Eurozone, reported a preliminary -0.3% reduction in Q2 GDP overnight.
Previously, Italy had recorder a 0.5% increase for Q1 and -0.3% for Q4 2007.
News of the negative GDP has sparked a technical busting rally in the Greenback against the Euro, Pound, and Franc.
The EURUSD is trading at 1.5066, 100 pips below the 50% fibonacci retracement of 50%. This is a sharp drop below the 1.53 - 1.60 range the pair has traded at since March.
The GBPUSD is also seeing technical levels shattered. The pair is trading at 1.9201, 200 pips below the the 1.94 support.
The USDCHF is trading at 1.07, a 5 month high and well above 1.06 resistance.
In related news, ECB Governing Council Member Wellink indicated Friday the ECB was ready to raise rates should CPI climb higher. He also reinforced recent market expectations for negative Euro-zone GDP growth in the second quarter, stating "I think it won't look so good"
fibonacci, Euro, European Central Bank, GDP, EUR
Text of Trichet Speech
Aug 7, 2008
Below is the full press release put out by the ECB this morning to accompany the rate decision.
I have NOT added any emphasis.
Jean-Claude Trichet, President of the ECB,
Lucas Papademos, Vice President of the ECB
Frankfurt am Main, 7 August 2008
Ladies and gentlemen, the Vice-President and I are very pleased to welcome you to our press conference. We will now report on the outcome of today's meeting of the Governing Council.
On the basis of our regular economic and monetary analyses, we decided at today's meeting to leave the key ECB interest rates unchanged. The information that has become available since our previous meeting has further underpinned the reasoning behind our decision to increase interest rates in July. It has confirmed that annual inflation rates are likely to remain well above levels consistent with price stability for a protracted period of time and that risks to price stability over the medium term remain on the upside. This assessment is underpinned by continued vigorous money growth, with so far no signs of significant constraints on bank loan supply. In such a context, it remains crucial to avoid broadly based second-round effects in wage and price-setting. The latest economic data point to a weakening of real GDP growth in mid-2008, which in part was expected after the exceptionally strong growth in the first quarter. Against this background and in full accordance with our mandate, we emphasise that maintaining price stability in the medium term is our primary objective and that it is our strong determination to keep medium and long-term inflation expectations firmly anchored in line with price stability. This will preserve purchasing power in the medium term and support sustainable growth and employment. On the basis of our assessment, the current monetary policy stance will contribute to achieving our objective. We will continue to monitor very closely all developments over the period ahead.
Allow me to explain our assessment in greater detail, starting with the economic analysis.
The information on economic activity that has become available since the July press conference suggests that real GDP growth figures for mid-2008 will be substantially weaker than for the first quarter of the year. As indicated on previous occasions, this represents partly a technical reaction to the strong growth seen in the first months of the year. In addition, it also partly reflects a weakening in GDP growth due to factors such as slower expansion at the global level and dampening effects from high and volatile oil and food prices. In order to assess the underlying momentum of euro area economic activity and to avoid being misguided by highly volatile quarterly outturns, it is necessary to look through the volatility in quarter-on-quarter growth rates and monthly indicators.
Taking this perspective, growth in the world economy, while moderating, is expected to remain relatively resilient, benefiting in particular from sustained growth in emerging economies. This should support external demand for euro area goods and services. As regards domestic developments, in a medium-term perspective the fundamentals of the euro area are sound and the euro area does not suffer from major imbalances. Investment growth in the euro area has provided ongoing, though moderating, support to economic activity. Moreover, employment and labour force participation have increased significantly, and unemployment rates remain low in historical terms. However, these developments, which support household disposable income and consumption, are unlikely to fully compensate the loss of purchasing power caused by higher energy and food prices.
In the view of the Governing Council, the uncertainty surrounding this outlook for economic activity remains high, owing to, among other things, the very high and volatile levels of commodity prices and the ongoing tensions in financial markets. Overall, downside risks prevail. In particular, risks stem from the dampening impact on consumption and investment of further unanticipated increases in energy and food prices. Moreover, downside risks continue to relate to the potential for the financial market tensions to affect the real economy more adversely than currently anticipated. The possibility of disorderly developments owing to global imbalances also implies downside risks to the outlook for economic activity, as do concerns about the emergence of protectionist pressures. In this respect, the failure of the recent negotiations in the context of the World Trade Organization's Doha round on trade liberalisation is a major setback.
With regard to price developments, annual HICP inflation has remained considerably above the level consistent with price stability since last autumn, reaching 4.0% in June 2008 and, according to Eurostat's flash estimate, 4.1% in July. This worrying level of inflation rates results largely from both direct and indirect effects of past sharp increases in energy and food prices at the global level. At the same time, while labour productivity growth has decelerated, there are some indications that labour cost growth has been rising in recent quarters.
Looking ahead, on the basis of current futures prices for commodities, the annual HICP inflation rate is likely to remain well above a level consistent with price stability for quite some time, moderating only gradually in 2009.
Risks to price stability at the policy-relevant medium-term horizon remain clearly on the upside and have increased over the past few months. These risks include notably the possibility of further increases in energy and food prices and of increasing indirect effects on consumer prices. There is a very strong concern that price and wage-setting behaviour could add to inflationary pressures via broadly based second-round effects. The Governing Council is monitoring price-setting behaviour and wage negotiations in the euro area with particular attention. Furthermore, there are potential upside risks from unanticipated rises in indirect taxes and administered prices.
Against this background, it is imperative to ensure that medium to longer-term inflation expectations remain firmly anchored at levels in line with price stability. The shift in relative prices and the related transfer of income from commodity-importing countries to commodity-exporting countries require a change in the behaviour of companies and households. Therefore, broadly based second-round effects stemming from the impact of higher energy and food prices on price and wage-setting behaviour must be avoided. All parties concerned, in both the private and the public sector, must meet their responsibilities in this regard. In this context, the Governing Council has repeatedly expressed its concern about the existence of schemes in which nominal wages are indexed to consumer prices. Such schemes involve the risk of upward shocks in inflation leading to a wage-price spiral, which would be detrimental to employment and competitiveness in the countries concerned. The Governing Council therefore calls for such schemes to be avoided.
The monetary analysis confirms the prevailing upside risks to price stability at medium to longer-term horizons. In line with our monetary policy strategy, we take the view that the sustained underlying strength of monetary and credit expansion in the euro area over the past few years has created upside risks to price stability. Over recent quarters, these risks appear to have become manifest as inflation has trended upwards.
Not least in the face of the ongoing tensions in financial markets, the monetary analysis helps to support the necessary medium-term orientation of monetary policy by focusing attention on the upside risks to price stability prevailing at medium to longer horizons. While the growth of broad money and credit aggregates is now showing some signs of moderation, also reflecting the policy measures taken since 2005 to address upside risks to price stability, the strong underlying pace of monetary expansion points to continued risks to price stability over the medium term.
The current yield curve has led to very rapid increases in time deposits and to a substantial decline in annual M1 growth. Such effects and other temporary factors must be taken into account in assessing monetary developments. Overall, a broad-based analysis of the data, taking the appropriate medium-term perspective, confirms the underlying strength of money growth.
One of the main factors leading to this conclusion is the still high growth of MFI loans to the private sector, which is underpinning the robust nature of monetary growth. The pace, maturity and sectoral composition of bank borrowing suggest that, at the level of the euro area as a whole, the availability of bank credit has, as yet, not been significantly affected by the ongoing financial tensions. Higher short-term interest rates and housing market weakness in several parts of the euro area have dampened the growth of household borrowing over the past few years. By contrast, and notwithstanding tighter financing conditions and moderating economic growth, the expansion of bank credit to non-financial corporations thus far remains very robust.
To sum up, a cross-check of the outcome of the economic analysis with that of the monetary analysis clearly confirms the assessment of increasing upside risks to price stability over the medium term. Annual inflation rates are likely to remain well above levels consistent with price stability, and monetary aggregates continue to grow vigorously, with so far no signs of significant constraints on bank loan supply. The latest economic data point to a weakening of real GDP growth in mid-2008, which in part was expected after the exceptionally strong growth in the first quarter. Against this background, it remains crucial to avoid broadly based second-round effects in wage and price-setting. In full accordance with our mandate, we emphasise that maintaining price stability in the medium term is our primary objective and that it is our strong determination to keep medium and long-term inflation expectations firmly anchored in line with price stability, thereby preserving purchasing power in the medium term and supporting sustainable growth and employment in the euro area. On the basis of our assessment, the current monetary policy stance will contribute to achieving our objective. We will continue to monitor very closely all developments over the period ahead.
Regarding fiscal policy, there are risks that some countries will not achieve their fiscal targets this year. In this situation a rigorous implementation of budget plans and the avoidance of expenditure slippage are of crucial importance. Budget plans for 2009, which are currently being finalised in a number of countries, need to reflect European commitments. In particular, countries with still large deficits must provide ambitious and concrete deficit reduction plans, backed by clearly specified measures, preferably on the expenditure side. Where budgetary scope is available, automatic stabilisers can contribute to the smoothing of cyclical economic fluctuations.
As regards structural policies, measures which reduce adjustment costs and promote moderate unit labour cost growth are of the utmost importance, particularly in the current climate of high inflation and slowing real GDP growth. These include the removal of impediments to competition in the services sector in general, and at the various stages of the food supply chain in the retail and distribution sectors, as well as in the energy sector, more specifically. Equally, making labour markets more flexible and enhancing investment in education and training would foster productivity, thereby increasing the scope for increases in real incomes.
We are now at your disposal for questions.
Source European Central Bank
ECB, Euro, European Central Bank, interest rates, Trichet, Papademos
ECB, BOE Hold Rates Steady
Aug 7, 2008
As just about everyone expected, the Bank of England and European Central Bank have held rates steady at 5.00% and 4.25%.
The Bank of England minutes will be available at 5:30am est on August 13th.
Jean Trichet's news conference will be held at 8:30am est today.
Given that German industrial output missed by a big margin, do not expect any hawkish sentiment.
Bank of England, ECB, European Central Bank, BOE
FOMC Statement Analysis
Aug 5, 2008
As widely expected, the FOMC held rates steady at 2% today.
The key to today's meeting was the statement released along with the decision.
1. They omitted the phrase in June's statement that indicated risks to growth appear "to have diminished somewhat."
Clearly, they are reacting to recent turmoil surrounding Fannie Mae, Freddie Mac, and Lehman Brothers. As I suggested earlier this week, the FOMC is chiefly concerned about liquidity, not inflation.
2. Their was only one dissenter, Dallas Reserve President Richard W. Fisher.
Leading up to the meeting, their had been some speculation that Philly Reserve President Charles Plosser would join Mr. Fisher's dissent. I believe we will see the dissent count rise to 2 or 3 in a meeting before the Fed finally does raise rates. As such, we are at least 2 meetings away from Fed rate hikes.
However, readers should remember that Frederic Mishkin will be stepping down at the end of this month. It will be interesting to see how the dynamic of the Board plays out as Elizabeth Duke essentially replaces the departing Governor.
3. The committee stated "the Committee expects inflation to moderate later this year and next year, but the inflation outlook remains highly uncertain."
That is pretty clear. Like many other central banks, the FOMC expects a slowdown in the economy to reduce inflation risks, without an increase in rates. However, the geopolitical concerns behind recent oil pricing makes this expectation uncertain.
So how does the US Dollar perform for the remainder of the week?
I think many traders had already bought into the notion the Fed was to be dovish today, and were thus not disappointed.
Across the Atlantic, news continues to sour for the UK and Euro-zone.
Today, the Nationwide survey of UK consumer confidence fell 11 points to 51. Year over year, that is a 46% decline in confidence, the steepest drop in the history of the report. And, industrial output fell to an annual rate of -1.6. In the Euro-zone, retail sales hit -3.1% today, and PMI slipped further into contraction at 48.3 for July.
For Thursday, Trichet and the ECB are unlikely to make hawkish statements. They are more likely to take a page from the FOMC and warn of downside risks with the expectation inflation will soften over the next few quarters on a weakening economy.
Their is a growing chance the Bank of England will signal a rate cut in their statement.
Given that forex markets have been dealing with a weak American economy for several months, the rapid slowdown across Europe and other parts of the world will probably play a bigger factor in trading action over the next few weeks.
Bank of England, European Central Bank, inflation, interest rates, FOMC, USD
Forex Preview August 3 - August 8
Aug 3, 2008
The core theme of the week will be rate decisions from 4 central banks and attached commentary.
Australia and US bank rates are declared on Tuesday.
On Thursday, banks in Great Britain and the Eurozone announce rate decisions.
All 4 banks are expected to remain on hold. The real market movement will come from associated statements
- The Reserve Bank of Australia (RBA) is apt to remain confident in economic growth and focus on inflationary concerns.
- the US FOMC is likely to focus on a struggling economy with inflation a secondary concern that can be dealt with later
- The Bank of England will presumably highlight a faltering economy, indicating rate cuts may be needed sooner rather than later. If their is one bank that surprises with rate movement this week, the BOE will be it with a rate cut.
- The ECB can be a wild card. Inflation remains double their mandate target. Yet, signs of a Eurozone slowdown are spreading like wildfire. With oil pulling back, their is reason to believe Trichet is going to stress a wait and see approach. However, hawkish comments on inflationary concerns remain a possibility.
Aside from the central bank action, markets are also likely to move on unemployment reports out of New Zealand on Wednesday, and Switzerland, Canada on Friday. The New Zealand report is the only significant data coming out on Wednesday, and as such may gain unusual attention.
Three other events to watch for are:
- the US PCE on Monday (I think their is potential for upside surprise).
- Eurozone Retail Sales and US ISM Services ahead of the FOMC rate decision on Tuesday
Sunday August 3
9:30pm Australia House Price Index (expect -1.3% QoQ, 8% YoY)
11pm New Zealand Commodity Price Index
Monday August 4
5am Eurozone PPI (expect 0.8% MoM, 7.9% YoY)
8:30am United States Personal Consumption Expenditure (expect 0.4% MoM, 2.2% YoY)
Tuesday August 5
12:30am Reserve Bank of Australia Rate Decision (expect hold at 7.25%)
4:30am Great Britain Industrial Production (expect 01% MoM, -1.2% YoY)
5am Eurozone Retail Sales (expect -0.6% MoM, -1.3% YoY)
10am ISM Services (expect 51.0 from 48.2, signaling growth)
2:15pm United States Fed Rate Decision (expect hold at 2%)
7pm Great Britain Consumer Confidence
Wednesday August 6
10:35am United States Crude Inventories
6:45pm New Zealand Employment Report (expect 0.2% QoQ, -0.6% YoY)
6:45pm New Zealand Unemployment Rate (expect 3.8%)
Thursday August 7
2am German Trade Balance (expect €15.5 billion)
2:45am French Trade Balance (expect €-4.6 billion)
7am Great Britain Rate Decision (expect hold at 5%)
7:45am European Central Bank Rate Decision
8:30am ECB President Trichet Press Conference
10am US Pending Home Sales (expect -1.3%)
Friday August 8
1:45am Switzerland Unemployment Rate (expect 2.3%)
4am Italy GDP (expect 0.0% QoQ, 0.3% YoY)
7am Canada Unemployment Rate (expect 6.2%)
Bank of England, ECB, European Central Bank, BOE, jobs report, RBA, upcoming reports, Fed, FOMC
ECB: Really One and Done?
Jun 30, 2008
The European Central Bank meets Thursday, July 3rd. For the past month, bank members have been hammering home the point they will raise rates 25bps at this meeting.
But the real pricing action from the meeting will be the commentary. With inflation spreading like wildfire across the globe, can the ECB really be one and done?
On the one hand, it seems very unlikely. Today's CPI came in at 4% (vs 3.9% expected), double their mandated target rate of 2%. And while the German economy has definitely seen growing signs of a slowdown, the data remains mixed across the Eurozone.
French consumer spending remains resilient, coming in at 3.1% YoY. Indeed, French GDP remains inline with expectations, coming in at a steady 2%. Wage growth remains strong in Italy, coming in at a better than expected 3.3%. And that wage growth may be the biggest problem of all for Trichet and the ECB. After all, Trichet has cited a fear of spiraling wage inflation as a reason for this month's presumed 25bps hike.
On the other hand, their is growing pressure for ECB policy change. French President Sarkozy suggested the Euro is 30% overvalued against the dollar. He wisely pointed out that such over-valuation makes it tough for Airbus to compete with Boeing. President Sarkozy's comments echo that of his finance minister, Christine Lagarde. Both have suggested that growth, and not inflation alone, should be a considered in rate hikes.
But the Atlanticist French may be singular in their views.
I'm not suggesting the Europeans will raise rates when they next meet (August 7). But the idea that commodity driven inflation will come down from 1 ECB rate hike is...silly. The Eurozone economy will not come to a screeching halt July 4 and thus offer price relief.
Perhaps the typical post Olympics bust will cool China's appetite a bit, but their GDP is still forecast for 10.3% growth this year. They have plenty of reconstruction needed in the wake of the Sichuan earthquake.
And, political tensions across the Middle East and Africa seem unlikely to ease. Indeed, former UN Ambassador John Bolton has suggested Israel will strike Iran after the US election.
Barring an FX market intervention from the G8 (they meet in full July 7-9), the ECB may have little choice but to resume a rate hiking agenda later this year.
ECB, European Central Bank, inflation, Trichet, rate hike
Forex Events June 22 - June 25
Jun 22, 2008
This week will be dominated by US data. The key mover may be comments from the Fed rate decision at 2:15pm est Wednesday.
Events Monday and Friday are clearly Euro positive, Greenback negative. Watch for the Euro to test the 1.5800 resistance on Monday. If it finally breaks the range, we could see an end to the sideways trading of the last few months as the ECB is definitely going to hike rates July 3rd.
New Zealand and Japan, 2 key parts of the carry trade, report significant data late Wednesday evening. Surprises on either side could be an omen for future carry trade volatility.
All times eastern standard time
Monday June 23
4am German IFO - Current and Expectations
4am Euro-zone PMI Services (expect 50.4)
4am Euro-zone PMI Manufacturing (expect 50.2)
Tuesday June 24
4am Swiss UBS Consumption Indicator
9am Case Shiller Home Price Index (expect 168.8)
10am US Consumer Confidence (expect 56.7, a 16 year low)
7:50pm Japan Trade balance (exclude services)
Wednesday June 25
8:30am US Durable Good Orders (expect -0.9% excluding transport)
10am US New Home sales (expect 530k, a flat reading)
2:15pm Fed Rate Decision (expect hold at 2%)
6:45pm New Zealand Current Account (expect -7.5%)
Thursday June 26
7:30am US fed Vice Chairman Speaks at ECB
8:30am US Q1 GDP finalized (expect 1.2% from initial 0.6%, thats big folks. Note, upgraded from 0.6% to 0.9% previously)
10am US Existing Home Sales
6:45pm New Zealand Q1 GDP (expect 2.1%)
6:45pm New Zealand May Trade Balance (expect +150million)
7:30pm Japan CPI
7:50pm Japan Retail Trade (Domestic)
Friday June 27
2:50am France GDP (expect 2.2%)
4am Euro-zone Current Account
4:30am Great Britain Q1 GDP (expect 2.5%)
10:00am US university of Michigan Consumer Confidence (expect 56.8)
European Central Bank, CPI, Carry Trade, trade balance, housing, upcoming reports, consumer confidence, durable goods, Fed, IFO
Majors Roundup For June 16
Jun 16, 2008
The trading week got under way with events all over the world driving currency pricing.
The Pound rose on CPI speculation, and anticipation of a plan from Governor Meyer. The Euro rose on CPI data and ECB comments. The greenback fell early on Empire Manufacturing, an early spike in oil, and Lehman Brothers first quarterly loss. But the damage was slightly muted by a pull back in oil, Fed President Lacker, and foreign inflows of capital.
The GBP was driven up as traders geared up for an anticipated Year over Year CPI number of 3.2%. This will trigger significant commentary from the Bank of England's Governor Mervyn King. By law, the bank will have to present a letter explaining why inflation is above 2%, what will be done to bring inflation back in line, and when inflation is expected to come back in line. Despite signs of a slowing UK economy, the BOE is likely to suggest that rate hikes will be necessary to combat inflation.
In the Euro-zone, year over year CPI came in at 3.7% (above expectations for 3.6%). Additionally, ECB Governing Council member Nout Wellink seemed to confirm currency traders anticipation of an ECB rate hike. He stated that markets "should not react to every change in the environment ... They should look through the information to see the underlying trends"
Reading between the lines, trends have been to focus on fighting inflation, which means more rate hikes.
In the US, the Empire Manufacturing survey fell much further than expected, declining to -8.7 (vs -4.7 expected). Oil futures shot out of the gates to an all time trading high of $139.89 before falling $5 in the afternoon. Additionally, Robert Novak published an article stating anticipations for a rate hike were off base. On the credit crunch front, Lehman Bros reported their first ever quarterly loss of $2.87 billion.
However, not everything was doom and gloom for the USD. US Capital inflow increased to $60 billion (from -$48 billion). Lehman Brothers was able to reduce mortgage holdings by 20% and slash their balance sheet by $147 billion. Additionally, they were able to raise $6 billion in new capital during the quarter. And Richmond Fed President Lacker reiterated "The principal risk is that high overall inflation will become embedded in expectations"
The pessimistic outlook for an economic slowdown spread to Japan, as the government cut expectations. For the second time in a row, the government used the key word 'pause', saying the "recovery appears to be pausing". Backing this assessment, condominium sales fell 17.5% in May.
The big news will happen early tomorrow morning as, the UK CPI and Goldman Sachs reports will be released before US markets open.
At 1am est, the EURUSD is at 1.5522, the GBPUSD 1.96580, and the USDJPY is at 107.79.
ECB, European Central Bank, CPI, GBP, Pound, USD
ECB Shocks Forex Markets, Hints at Rates Increase
Jun 5, 2008
Continuing a week of market moving central bank comments, ECB President Trichet indicated the European bank may raise rates 25bps next month.
While he avoided using the word 'vigilant', Trichet stated that in the "next meeting we do not exclude to raise rates...I don't say it's certain, I say it's possible" Eurozone inflation is running at 3.6%, far above the target 2%, and just below their current 4% interest rate. The ECB may also be dealing with the reality of oil demonstrations spreading across Europe the last 3 weeks.
The ECB also narrowed 2008 GDP growth to a range of 1.5% - 2.1%. Previously, the low end was at 1.3%.
Amazingly, the hint of a rate hike came soon after a new report indicating a German slowdown. Factory orders in Germany fell -1.8% vs 0.5% projected.
The EURUSD tested the $1.56 level (up nearly 200 points) on Trichet's comments.
ECB, European Central Bank, Trichet, rate hike
ZEW Predicts More ECB Rate Hikes, US and German Numbers Bad
May 20, 2008
As was expected, the main driving force in Euro FX trades came from the ZEW. However, the devil really was in the details, as the "what" caught traders by surprise. The German ZEW sentiment dropped to -41.4, lower than the expected increase to -37. Worse yet, German PPI came in at 1.1%, far higher than the expected 0.5% reading.
Depsite the bad fundamental news, markets moved on future expectations from the ZEW of an ECB rate hike. Wolfgang Franz, head of ZEW, supplied a mild jolt to the market when he indicated the ECB may increase rates "in the near future". For months now, many traders have thought the ECB was moving towards a rate cut - the global credit crunch, negative Eurozone consumer sentiment, and a crash in housing in many European countries was thought to portend a very bad slowdown. Nevertheless, as Mr. Trichet reiterated last week and yesterday, inflation remains concern #1 for the ECB.
In the US, wholesale inflation was up 0.2% for April, an ok number after the 1.1% jump in March. However, core inflation was worse than expected, coming in 0.4% vs the expected 0.2% increase. On top of the core inflation and record oil prices (which are just insane and way out of whack with the fundamental decline in gas demand + inventory increases), the US government raised their forecast for food price increases to a 4.5% - 5.5% range. That would be the largest annual growth since 1990. Overall, US inflation is up 3% in the last year, making it the largest increase since 1991.
In late trading, the EURUSD was up more than a cent to $1.5660, the GBPUSD was up to $1.9682. The dollar was also off against the Yen and Swiss Franc.
ECB, European Central Bank, inflation, ZEW Survey, EUR, USD
BOE, ECB Hold Rates Steady
May 8, 2008
In moves that were largely expected, the Bank of England (BOE) and the European Central Bank (ECB) held rates steady at 5% and 4% respectively.
ECB President Jean Trichet did not produce the dovish commentary some currency traders thought might be coming. A string of bad news in Germany and throughout Europe seemed to suggest the Eurozone economy was cooling. However, Mr. Trichet held his ground, stating that inflation remained the "highest priority" (I wonder if their some German version of Cramer screaming 'They know nothing').
In England, a series of bad news also had some currency traders speculating the bank might cut by 0.25%. Like the ECB, they held to their view that inflation was the number one priority. Minutes from the BOE meeting will be released May 21, and will likely contain some votes for a rate cut.
Both currencies were largely flat against the Dollar. The Euro gained 0.0003 to close at $1.5404, the Pound was up 0.0004 to $1.9534
Read more at Yahoo on ECB and Yahoo on BOE
Bank of England, ECB, European Central Bank, BOE, interest rates
German Confidence = High Euro, Weak Dollar
Apr 14, 2008
Investors expect a new German report will that faith in the economy remains strong. The Euro went as high as $1.5824, less than 1 cent below the all time high of $1.5913 reached April 10. Continued strength in the Eurozone has made ECB rate cuts less likely.
Read more at Bloomberg
ECB, Euro, European Central Bank, USD
ECB Holds rates Steady, Euro Hits Record $1.5912
Apr 10, 2008
As expected, the European Central Bank held rates steady at 4% Thursday. Prior to the announcement, the Euro hit an all time high of $1.5912. The previous high of $1.5904 was set just 3 weeks ago on March 17th.
In late trading, the 15 nation Euro currency gave back some pf the gains, trading at $1.5828.
Read more at Yahoo
ECB, Euro, European Central Bank
