ECB minutes offer little fresh insight - EUR unimpressed - all eyes on US CPI
This afternoon's ECB minutes were never expected to be a major market mover in that the governing council has already opened the door to further (marginal) rate cuts and the market looking to a fresh round of QE. In light of this, the EUR has shown little response to the release.
The council minutes revealed some members argued for more accommodative terms on the TLTRO, and that there should be no complacency over the falling inflation expectations. As such, discussions show policymakers are ready to act, through rates, QE or forward guidance.
EUR/USD has been stable through the Euro am session, with a brief test of 1.1280 coming to little as the market turns its attention to the US inflation numbers out at 13.30 London time. This will set the tone for the spot rate and indeed the rest of the spot rates, where the USD remains under pressure in the wake of the dovish testimony from Fed chair Powell yesterday.
Powell addresses the Senate Banking Committee this afternoon, though it is expected to be a reiteration of comments made yesterday.
Today is all about the inflation report from the US and a weak number will see the USD under pressure again. We are expecting a fall from 1.8% to 1.6%, with the May reading expected to come in flat.
We also get US jobless claims. Later in the day, we have plenty more Fed speakers on today's schedule, including Williams, Bostic, Barkin, Quarles, and Kashkari.