10 Apr 2014
Noting key European developments - BBH
FXStreet (Guatemala) - FXStreet (Guatemala) - Marc Chandler, Global Head of Currency Strategy at Brown Brothers Harriman noted the developments in Europe.
Key Quotes:
"There are three developments in Europe to note. The most important was the Riksbank meeting and the lowered repo path, which has seen an increase in the likelihood of a rate cut from about 15% to near 40%."
"The key is prices, not growth. The central bank’s CPI forecast was cut to 0.2% from 0.6%, even as the growth forecast was lifted to 2.7% from 2.4%."
"Recall that yesterday, there was an upward revision to the forecast for Swedish GDP growth to 2.8% from 2.3%. High household indebtedness remains an issue, especially for the hawks, but the low inflation concerns generally outweigh this and it is here that investors need to look for insight into what officials will do in July. There are three inflation reports out between now and then."
Key Quotes:
"There are three developments in Europe to note. The most important was the Riksbank meeting and the lowered repo path, which has seen an increase in the likelihood of a rate cut from about 15% to near 40%."
"The key is prices, not growth. The central bank’s CPI forecast was cut to 0.2% from 0.6%, even as the growth forecast was lifted to 2.7% from 2.4%."
"Recall that yesterday, there was an upward revision to the forecast for Swedish GDP growth to 2.8% from 2.3%. High household indebtedness remains an issue, especially for the hawks, but the low inflation concerns generally outweigh this and it is here that investors need to look for insight into what officials will do in July. There are three inflation reports out between now and then."