EUR in Focus with Draghi Speaking and Trading Facts and Figures

All eyes and ears open to the news! The EUR is in focus with Draghi speaking today and trading facts and figures.

IMFC Key Points – 13 October 2017, Washington D.C.

At the 36th Meeting of the International Monetary and Financial Committee held in Washington DC on 13th October 2017, ECB’s President Mario Draghi focused on the following main points:

  • EURO area economic expansion, which he felt was supported by the current ECB monetary policy measures;
  • Despite latest Catalonia developments and Brexit on the move, the European economy has shown a steady growth over the last 17 quarters, at a pace that exceeded economists’ expectations, with employment rates increasing by approximately 7 million, and youth unemployment rate slipping down to 19%, from  24% in 2013;
  • Inflation would supposedly show a gradual increase over the medium term in line with the ECB measures, while the Eurozone would no longer be at risk of deflation- headline inflation projected at 1.5% in 2017, 1.2% in 2018, and 1.5% in 2019;
  • Annual GDP envisaged to  increase by 2.2% in 2017, 1.8% in 2018, and 1.7% in 2019;
  • More sustained efforts required to keep volatility at bay, with a focus on its influence on price stability over the medium term;
  • APP (asset purchase programme) revolving around Euro 60 billion, expected to maintain this level until December;
  • More efforts towards the EU monetary union required to strengthen European economy and more integration to be achieved.

What to expect:

  • More on EU economy and inflation;
  • EUR in focus, currently trading around 1.1752 against USD as Draghi speaks.

Trading Facts and Figures

Wednesday, ahead of ECB’s President speech today, the Aussie traded at a steady pace against the greenback, while the kiwi dropped in reaction to the allegation that the Federal Reserve strives to support the US currency.

AUDUSD closed at about 0.7849.

USD continued to support following Monday’s news that President Donald Trump favoured John Taylor in the run for the Federal Reserve Chair next year, replacing Janet Yellen.

Later this week, Trump is to meet the current Federal Reserve President Janet Yellen and further discuss the details regarding the appointment of her successor.

Fed Governor Jerome Powell and former Fed member Kevin Warsh are generally seen as strong potential candidates to succeed Yellen when her tenure ends, in February.

The US dollar also gained strength in reaction to Tuesday’s data release regarding the US industrial and manufacturing growth, confirming economists’ forecast last month.

According to another report, import and export prices increased dramatically, exceeding the levels envisaged in September.

NZDUSD slipped by 0.29%, opening at 0.7184 and closing at 0.7174, showing a 10-pip spike.