ECB President Draghi On The EUR Monetary Policy
Nothing from ECB president Draghi on monetary policy, which we somewhat suspected given the governing council's stance is widely acknowledged.
The president is also loath to add more fuel to the fire - given previous instances of market overreaction - so for now, the EUR is enjoying a relative period of calm and is grinding higher still to suggest a move on 1.2000 later on today may be on the cards. It has been a relentless few weeks of USD buying, but the DXY looks to have topped out in the near term, and this sees the heavily weighted (USD) pair seeing the brunt of the modest reversal, which is now almost 1.5 cents off the lows seen this week.
We expect pre 1.2000 will be well offered, but with focus now on the US yield curve and the flattening seen once again (to levels last noted in 2007), the greenback is back under pressure, with the Fed's Bullard (speaking this afternoon) also suggesting the Fed may have to rein in their hiking intentions and that rates are likely already back to neutral. Bullard is a known (rate) dove, so limited attention on his comments in this respect.