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Draghi Disappoints Euro With Lack Of Monetary Policy Movement

Published 26/04/2018, 16:40
Updated 21/10/2020, 09:15

Predictably the euro didn’t like what Mario Draghi had to say, the single currency tumbling ahead both the dollar and the pound.

The ECB didn’t actually do much this Thursday – and that was maybe the problem. Draghi’s typically cautiousness post-meeting address seemed to upset the euro, specifically his claim that the central bank ‘didn’t discuss monetary policy per se’, to instead focus on the topic of the Eurozone’s recovery and how ‘broadly all countries experienced...some moderation in growth or some loss of momentum’ in the last month. The currency is clearly frustrated with the ECB’s lack of clarity in signalling whether or not its bond buying scheme will end before the year is over.

Bitterly disappointed the euro shed 0.5% against the dollar, sending it to a fresh 3 and a half month low, while it lost 0.6% against the pound, causing the currency to hit its worse price in over a week against sterling. All this, of course, was music to the ears of the DAX and CAC, with the German and French indices up 0.5% and 0.7% respectively.

Despite the pound’s gains – cable also nudged above $1.395 with a 0.1% increase – the FTSE managed to eke out its own growth this Thursday. The UK index teased 7400 with a 0.2% increase, continuing to sit in the ballpark of Tuesday’s 11 week peak. Both should get a workout tomorrow, with the first look at the UK’s Q1 GDP reading potentially having important ramifications for May’s Bank of England meeting.

As for the US markets, the Dow Jones continued to try and claw back Tuesday night’s sizeable losses. The Dow jumped 125 point after the bell, re-crossing 24200, in part boosted by another very strong jobless claims reading and a better than forecast durable goods orders number.

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