The Euro/Swiss franc was the epicenter of the turmoil after the Swiss National Bank surprisingly pulled the rug from under the bulls’ feet on Thursday and let the dormant currency pair plummet to below parity from 1.20.
The U.S. stock markets bounced back strongly in mid-week after a poor start to the year, though on Friday the major indices eased back once again despite the release of another strong U.S. jobs report.
Mario Draghi and his European Central Bank colleagues disappointed the markets on Thursday by refusing to deliver what speculators were demanding. Ultimately, the ECB will have to do more to fight off deflationary threats; after all, it cut its own inflation and growth estimates at Thursday’s policy meeting.
On Friday, we found out that the Eurozone’s painfully slow economic recovery continued for another quarter. Surprisingly, the growth was fuelled by better performances from some of the peripheries, although France did well, too, as it expanded 0.3% over the quarter.