Next week, will be the European Central Bank (ECB) meeting. According to analysts at MUFG Bank the central bank is set to dent any upside potential for EUR/USD. They see Lagarde pushing back aggressively on market pricing, consistent with the new monetary strategy.
“One highlight of this week has been the resignation of Jens Weidmann from the ECB two years into his second eight-year term, citing personal reasons. While it is easy to dismiss this or even conclude it as being a dovish development with a hawk set to be replaced, the event could well be an indication of the scale of opposition building to the ECB’s current monetary stance. However, we do not expect possible building opposition to be on show next week and expect President Lagarde to push back strongly against the recent shift in rate expectations.”
“Lagarde is also going to have added justification given the increased evidence that supply constraints are curtailing economic activity. While the advance manufacturing PMI picked up in October, the services component was much weaker than expected, suggesting the energy price spike could be starting to impact sentiment on the consumer side.”
“The dollar remains under downward pressure with global risk appetite improving. The avoidance of default in China could see this momentum continue but we do not see much upside for EUR/USD given the ECB’s message is unlikely to be supportive.”
© 2000-2024. All rights reserved.
This site is managed by Teletrade D.J. LLC 2351 LLC 2022 (Euro House, Richmond Hill Road, Kingstown, VC0100, St. Vincent and the Grenadines).
The information on this website is for informational purposes only and does not constitute any investment advice.
The company does not serve or provide services to customers who are residents of the US, Canada, Iran, The Democratic People's Republic of Korea, Yemen and FATF blacklisted countries.
Making transactions on financial markets with marginal financial instruments opens up wide possibilities and allows investors who are willing to take risks to earn high profits, carrying a potentially high risk of losses at the same time. Therefore you should responsibly approach the issue of choosing the appropriate investment strategy, taking the available resources into account, before starting trading.
Use of the information: full or partial use of materials from this website must always be referenced to TeleTrade as the source of information. Use of the materials on the Internet must be accompanied by a hyperlink to teletrade.org. Automatic import of materials and information from this website is prohibited.
Please contact our PR department if you have any questions or need assistance at pr@teletrade.global.