Tag Archives: Trichet
Behavioral Finance: Daily Forex Outlook: Trichet sets stage for Draghi rate cut
EUR/USD (1.3430) Expectations of an immediate ECB rate cut were trimmed in the hours that preceded yesterday’s rate-setting meeting. As suspected, traders considered any inaction as negative for growth and, by extension, negative for the euro.
Behavioral Finance: Daily Forex Outlook: Euro maintains optimistic undercurrent, for now
EUR/USD (1.3615) Eurozone policymakers seem to have been rather dismissive of discussions about the transformation of the EFSF into a two-trillion-euro-heavy leveraged bailout vehicle. German finance minister, Schauble, has been notably critical and Bundesbank president, Jens Weidmann, has also indicated that the ECB would not play a role, a stance that reportedly has the full […]
ECB poised to act to reassure markets
Eurozone bank sector tensions are being watched closely by the European Central Bank, which has a range of policy weapons it could deploy swiftly to reassure nervous financial markets.
EUR and the ECB
The ECB’s Trichet signalled a clear change in tone at Thursday’s press conference, not only removing the reference to upside risks to inflation, but also highlighting that downside risks to growth had intensified. Indeed, Trichet even re-emphasised in the Q&A session the significance of these changes, saying that the balance of risks have changed.
S&P Says Joint Euro Bond Would Get Rating of ‘Weakest Link’
It is going to be a tough week for the EUR. Trichet is expected to be softer in his tone and the EUR will stay under pressure into the ECB. If he is not dovish, EUR will be still under downward pressure, as the market will increasingly discuss the erosion of ECB credibility.
ECB – bond buying, money market liquidity
ECB – Hint at bond buying and announcement of more money market liquidity (Astrid Schilo, Senior European Economist) – Bond buying programme is ongoing – Increased money market liquidity via new 6 mth tender, roll-over of 3 mth full allotment – ECB rates on hold at 1.5%, unchanged key expressions, more emphasis on growth uncertainty
FT – ECB and Merkel clash over Greece
The head of the European Central Bank placed a major obstacle on the path to a new agreement on a Greek financial bail-out, saying the bank could not accept defaulted bonds as collateral, potentially cutting off fundng from the Greek banking system.
Daily Forex Outlook: The Fed speech after Bernanke’s
EUR USD (1.4490) Jean-Claude Trichet delivered yesterday what the majority of market participants had come to expect by saying ‘strong vigilance’ will be needed to curb upward price pressure. The euro sold off on what is generally thought to indicate an imminent rate hike, reportedly due to ‘buy the rumour sell the fact’ dynamics.