4 Jul 2013
Flash: Seeking dovishness from Draghi – Societe Generale
FXstreet.com (Barcelona) - Kit Juckes, Global Head of Currency Strategy at Societe Generale notes that with the US on holiday, the ECB meeting take centre stage today.
Additionally, he adds that the UK MPC is also meeting and it isn’t inconceivable that Mr Carney would want to shake things up in terms of post-meeting communication, but it may be too soon for that and most likely is a non-event. As for the ECB, Juckes feels that a further rate cut is on the cards in due course but not today. He writes, “Everyone is ready for Mr Draghi to sound dovish at the press conference and I see no reason to disagree. EUR/USD and EUR/GBP won’t see fall fast on such an anticipated outcome but Euro rates are going to fall back, and US/Euro rate spreads can continue widening.”
Additionally, he adds that the UK MPC is also meeting and it isn’t inconceivable that Mr Carney would want to shake things up in terms of post-meeting communication, but it may be too soon for that and most likely is a non-event. As for the ECB, Juckes feels that a further rate cut is on the cards in due course but not today. He writes, “Everyone is ready for Mr Draghi to sound dovish at the press conference and I see no reason to disagree. EUR/USD and EUR/GBP won’t see fall fast on such an anticipated outcome but Euro rates are going to fall back, and US/Euro rate spreads can continue widening.”