On Friday, ECB President Mario Draghi delivered a damning indictment on the Eurozone economy, saying that underlying growth momentum remains weak, the economic situation in the euro-area remains difficult and that the inflation situation has become more challenging.
A funny thing happened last week: there were signs of a re-emergence of the sovereign debt crisis in the Eurozone, but the euro actually managed to eke out a gain against most of the G10 currencies including the pound and the U.S. dollar.
FX traders are about to enter an action-packed next 72 hours, with BOE Minutes, monetary policy decisions from the Fed and SNB, the ECB’s TLTRO auction, and of course, the result of Scotland’s highly-anticipated independence referendum all scheduled for release by the end of the week.
In December of last year, the Fed announced intentions to begin tapering its monthly bond purchasing program, with the hope of ending Quantitative Easing (QE) altogether by late fall of 2014. We initially saw the long end of the Treasury curve moving lower