ibusinesslines.com
ibusinesslines.com March 24, 2017


United States dollar slips, euro rises after ECB's Draghi speaks

21 March 2017, 02:08 | Myron Mathis

AFP Getty Images

AFP  Getty Images

German Finance Minister Wolfgang Schaeuble went further yesterday, saying he was in favour of a "timely start to the exit" from the ECB's loose monetary policy, echoing calls from the German banking association and the Ifo economic institute.

"This is a gradual process", Mr Draghi said.

The upshot is that the European Central Bank kept rates and stimulus settings on hold, and stuck to its "forward guidance" that interest rates will stay low, or lower, beyond the end of the current asset-purchase programme in December.

"The reason is simple because it is hard to write off the positive impact of growing inflation and growth [.] It is in Draghi's interest to keep buying more time until we have navigated through all these [political] storms and sailing becomes smoother".

Mario Draghi will give further details on the ECB's decision at a news conference later. But "the expectation, the probability of an expectation that it will actually materialise into lower level, has gone down", Draghi said.

Meanwhile, inflation should reach 1.7 per cent in 2017 and 1.6 per cent in 2018 - up from previous predictions of 1.3 per cent and 1.5 per cent.


The single currency ended the day 0.3 per cent higher and was up another 0.3 per cent as of 10.59am Frankfurt time today, trading at US$1.0613 (RM4.73).

Facing low inflation and weak growth, the European Central Bank has kept interest rates in negative territory and bonds purchases at 80 billion euros a month, promising substantial accommodation and an extended market presence to aid the euro zone's recovery.

Europe's benchmark government bond yield hit a one-month high and the euro firmed against the dollar after the European Central Bank removed from its latest policy statement a reference to using all available instruments to prop up growth and inflation.

The figures strengthen the case for the Federal Reserve to hike interest rates this month - the odds now stand at 80% - and only an incredibly disappointing non-farm payrolls report tomorrow could stop the United States central bank in its tracks. "Now these risks - some of them - have materialised, but we haven't seen yet a significant economic impact".

The ECB will issue its latest policy update at 7:45 a.m. If they cut the easing bias and then cut the pace of purchases without there being a sustained rise in wage costs, then we could legitimately ask: "what are you guys doing?" In any event ... we are ready.



Other News

Trending Now

Angry mob pelts stones, set police vehicles ablaze
Additional Commissioner of Police Manoj Lohia said the man who posted the morphed image has been arrested. The entire area was cornered off and heavy police was deployed to avoid any untoward incident.

Data breach at Saks Fifth Avenue exposes customers' personal information
BuzzFeed also alleges that some pages on the Saks site were not properly secured, potentially leaving online shoppers vulnerable. This means that personal information could have been stolen by hackers if the customers were on a public Wi-Fi connection.

Warren says 'Gorsuch doesn't belong on the Supreme Court' in op-ed
The Utah Republican said in his experience, the process reveals the kind of judge senators want to see appointed. Before that, he was a high-ranking official in the Justice Department under President George W.

Pochettino's answers who will play up front for Tottenham vs Southampton
They cost a combined £20m and both came from Pochettino's former club Southampton (although Alderweireld was on loan at St. I felt frightful straight after it but it's important I put it behind me and make sure I learn from it and keep improving.

Kintampo Waterfall Accident Kills At Least 18 In Ghana
According to reports, the tree fell onto persons, a lot of them believed to be students, who were swimming under the fall. Fourteen students from Wenchi Methodist Senior High School in Ghana are among the 18 people killed, Boampong added.

Orient winding-up petition adjourned
Here is how fans of the Brisbane Road outfit reacted to the news this morning that they will live to fight another day. Kelly Kaye, who has been a fan for 32 years, said: It would be good if the club could be sold.

Federal Bureau of Investigation director confirms probe into alleged Russian interference in United States vote
Spicer asserted that no evidence has been presented to suggest cooperation between Trump associates and Russian operatives. The Department of Justice has asked me to share with you that the answer is the same.