Eur/usd - page 276
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ECB's Draghi: QE proceeding well
Opening statement from Mario Draghi following June 2015 governing council meeting
EUR/USD: Euro Climbs Above $1.12 After Draghi's Presser
The euro rose above $1.12 versus the US dollar on Wednesday, following theEuropean Central Bank (ECB) monetary decision and a press conference from bank President Mario Draghi, whose speech was taken positively.
The bloc's currency rose 0.55% to $1.1212 versus its US peer on Wednesday, rebounding from an intraday low at $1.1078, which was brought on by volatility during Draghi's speech.
The ECB upwardly revised its price growth forecast for this year on Wednesday, citing the weaker euro and expectations that crude oil prices will rebound in the future. The bank expects GDP to rise by 1.5%, 1.9% and 2% in 2015, 2016 and 2017, respectively.
ECB President Mario Draghi was sounding rather optimistic and said the ECB's asset purchase programs "are proceeding well."He cheered positive effects of the ECB’s bond-buying program and brushed off any hints of premature tapering by stressing that the purchases will proceed as originally planned - meaning at least until September 2016.
Inflation in the 19-nation bloc is expected to grow 0.3%, 1.5% and 1.8% in 2015, 2016 and 2017, respectively. That's three notches higher for this year compared to the March projection, which had forecast flat price growth in 2015.On Tuesday, a preliminary print from Eurostat showed consumer inflation in the bloc rising for the first time in six months, even beating estimates.
Concerning the ongoing Greek saga, Draghi expressed hopes that Greece and its international lenders will soon reach an agreement.
"The governing council of the ECB wants Greece to stay in the euro, but there should be a strong agreement," he claimed. "One that creates growth, and which is fiscally sustainable and addresses the remaining sources of financial instability. This will be the component of a strong agreement."
As for the rate decision, the central bank left Europe's benchmark lending rate at a record low of 0.05%, while its deposit rate is to stay at -0.20%, effectively charging lenders for holding their deposits with the central bank. Meanwhile, the marginal lending facility rate (which shows the rate for overnight credit to banks from the Eurosystem) remained at 0.30%.
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Incredible move by the euro. The U.S. Dollar dropped by 4%.
A good day positive ECB conference today and the news that a deal is close for Greece had a huge impact today on the EUR/USD.
USD performed disappointingly against main currencies after another dose of weak economic data and optimism about Greece.EUR climbed nearly 2% to 1.1149 against the USD over the past day, recording its best daily move since March.
EUR/USD: Euro Pares Previous Gains, But Holds Near 1-Mth High
The euro is trading in a tight range after it rose sharply in the previous session as optimism continued to grow that Greece and its creditors will reach an agreement. Moreover, a fast uptick above $1.1250 came after ECB increased it's inflation forecast.
ECB President Draghi said on Wednesday that the QE program will be fully implemented and that the Governing Council has not discussed an exit strategy. Draghi also said that QE is set to run until September 2016 or later if necessary, which increased yields on German bunds.
EUR/USD was virtually flat ahead of the opening bell, trading in a tight range around $1.1265. In the previous session the euro jumped more than 200 pips.
Another important factor behind euro strengthening is the weak US Services data, which plunged to a 4-month low.
Financial firm Markit said its final reading of the US PMI for the services sector eased to 56.2 during the fifth month of the year from the 57.4 seen in April. That's the weakest number since January, when it hit 54.2.
The primary focus is now on tomorrow's NFP data, which if in line with expectations would be the second lowest reading this year. Markets expect the US economy to have added 227,000 jobs in May.
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On yesterday session the EURUSD initially fell but found enough support at 1.1097 to turn around and close near the high of the day, above a daily resistance. These 2 last sharp upward days are suggesting that traders are expecting bad US data on Friday. The next resistances are 1.1391 and 1.1460 to the downside we have the support zone, from 1.1236 down to 1.1097.
Eurozone retail sales PMI rises in May
Markit retail PMI's for EuropeThe upbeat European consumer in April looks like they will carry over into May as the Markit retail PMI's for Europe all show good gains (bar Italy)
France looks to be digging its way out of contraction but Italy has fallen back. The Eurozone is back in expansion so we should bear this in mind when we get the main retail numbers for May later this month
source
Within the last two days EUR gained 3.30% against the dollar. The rally of the EUR is limited by the resistance around 1.1290, which the price reached several times during yesterday and today. When crossing this level I think that we may expect testing the top from 15 May at 1.1471.
The euro slipped a bit... Maybe it's too early to see such quick signs of recovery.