Euro trades higher as markets await BOE and ECB rate decisions
07/Feb/2013 • Currency Updates•
Following what was a rather bearish start to the week, the pound held firm on Wednesday with the only movement showing general range trading between the key support and resistance levels. Despite significantly worse than expected Housing price data with MoM figures showing a reduction of 0.2% and the three MoY figures showing only a 1.3% increase as opposed to the 1.6% expected, the UK currency was able to close at the high of the day and continued to hold its head above water throughout the Asian markets suggesting a break higher could be seen depending on the upcoming economic data.
Today all eyes will be pinned on the release of the BOE rate decision and Asset Purchasing program due for release at midday with expectations predicting no change, however ahead of this release all ears will be listening out for any clues to the UK economic future during Carney’s “question time” starting at 9:45.
Furthermore an array of manufacturing and industrial production figures and the NIESR (Nation Institute for Economic and Social Research) GDP estimate for January should keep the markets moving with relatively negative figures expected across the board.
Information for the EU was relatively light yesterday, with only the German Factory Orders showing a midweek release which itself showed a negative 1.8% YoY as opposed to the expected -1.2%.
As with the UK, the ECB rate decision is due for release with expectations predicting no change keeping the current level of 0.75% for the foreseeable future. However not to be out done, ECB’s Draghi is due to hold a press conference at 13:30 today, where once again traders will be listening intently for any signs of possible movements and concerns for the EU economic outlook.
As with most major currencies yesterday the US had little for release also, allowing the USD to hold firm against the EUR seeing very little movement during UK market hours.
Today we see initial jobless claims being at the height of their agenda with expectations suggesting a slight reduction of 368k to 360k. This could potentially be taken with a pinch of salt though following the negative unemployment rate and non-farm payrolls released last Friday, both showing a worse than expected result.
The only other key data released in the US today should show the consumer credit levels following general global trends with a deduction of over $2bn bringing the level to a flat $14bn for December suggesting purse strings could be getting tighter as borrowing continues to become increasingly difficult.