9:11am January 12, 2018
Market Insight

Euro Bid As ECB Hints at Policy Change


Once again yesterday we saw some good moves in the currency markets as volatility increases into the new year. First up we saw much better than expected retail sales numbers out of Australia push the Aussie dollar up across the board. This was followed later on in the day by a strong move to the topside in the Euro as ECB Meeting accounts showed that there’s strong possibility of a change of policy from the central bank early this year. They said that they would revisit their communication stance early in 2018 indicating that they may be pulling back on their QE programme and this is certainly backed up by recent data. Euro jumped over a big figure on the day from lows around 1.1940 to top out at 1.2060 and has remained bid since.

The dollar index dropped sharply on this news and weaker than expected PPI data reinforced the move later in the day coming out at -0.1% against the expected 0.2%, it’s found support once again around the 91.80 level but expect this to be challenged later today if we see a poor CPI print from the US.

Looking ahead to today’s sessions and it is very quiet on the fundamental data front until we get to that New York session. The only thing coming out to possibly trouble the scorers prior is the Chinese Trade Balance numbers which are tentatively due our around lunchtime here in Sydney. Then it’s a long wait until the US open when we have both the CPI and Retails Sales numbers out of the US, the market has a very keen focus on the CPI data in particular and expect this to dominate moves into the weekend.

Good Luck trading today! If you have any questions or queries, please contact the team at info@sec.rakuten.com.au

Click here to see our Daily Market Update webcast for a more in-depth look at the day ahead.

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