Good morning,

We end the week following a choppy day yesterday with the European Central Bank not failing to deliver the expected volatility mentioned yesterday. In a brief summary, the euro shot up, then shot down, and subsequently recovered back to where it started with markets deciding that things were pretty much priced as they should be. GBPEUR enjoyed a high of 1.1250 before returning back to its comfort zone, whilst EURUSD dropped to a ten-day low of 1.0930 before coming back up for air.

It seems that, following yesterday’s decision and introduction of the stimulus package from Draghi, the element of monetary policy will look to take a back seat, with Fiscal policy taking the reigns from here.

Looking ahead today, we enter market open with a punchy GBPUSD price above 1.24 and EURUSD back above 1.11. USD weakness has allowed currencies to strengthen this morning with EURUSD 1.7% above its low from yesterday. With rumours spilling out of an interim US/China deal, it seems that Trump’s concern over the economy are coming to light as investors are less afraid to move from the haven currencies into more riskier assets.

Key data today will circle around the US retail sales due out at 13:30 today. With the consumer base seen to be carrying the US economy at the moment, a negative reading here may cause flight from the US dollar. Next week will be a busy one with plenty of data and central bank meetings to digest.

Have a great weekend.

Author: Ross Hammond, Senior Corporate Account Manager