After focusing on the pound and November’s prospective BoE rate hike, the markets turn their attention to a different currency and central bank pairing this Thursday.
It’s the euro’s turn in the spotlight, with a potentially crucial ECB meeting on the cards this afternoon. Analysts are expecting Mario Draghi and his colleagues to announce the next stage of their QE tapering programme; one potential scenario is that the bond buying continues until at least September 2018, but at €20 billion or €30 billion a month rather than the current €60 billion (which itself is down from €80 billion at the start of the year).
This potential ‘extend but reduce’ approach seems to have tentatively pleased the euro. Against the dollar it rose 0.1%, leaving almost a cent between its current $1.182 price and Monday’s 3-ish week lows; against the pound, meanwhile, the euro is up 0.2%, taking back roughly a third of Wednesday’s UK GDP-inspired losses.
As for the FTSE, with the pound only giving back a slither of ground against both the euro and the dollar – cable slipped 0.1% – the UK index couldn’t muster much momentum after the bell. Instead it nudged around 10 points higher, with its 7455 open the worst in more than 3 weeks.
The index has been slightly hampered by the 4.5% suffered by Barclays (LON:BARC) following the bank’s Q3 update. Despite pre-tax profit surging a third to £1.1 billion, net operating income came in at £4.46 billion, markedly lower than the £4.65 billion forecast, due to a slump in its markets division.
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