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By Associated FX Analysis Team

Kantox currency update: euro ticks up with the ECB on focus

Published September 7, 2017

european central bankThe euro is ticking up against the dollar, with risk sentiment improving and the investors focused on the conclusion of the ECB monetary policy meeting, to know the bank’s economic perspectives and, hopefully, some details about the QE tapering plans.

Furthermore, the Bank of Canada hiked interest rates from 0.75% to 1% against expectations and sent the U.S. dollar plummeting nearly 2% in one day to reach its lowest prices in more than 2 years against its Canadian counterpart.

EUR/USD: picking up above 1.1900. The euro has been trading slightly higher, over the last three days, yet trapped within a range of about 100 pips both sides of 1.1900. At London market opening times, the EUR/USD is trading at 1.1925.

GBP/USD: fresh one-month highs near 1.3100. After breaking past 1.3000 on Tuesday, the pair advanced further yesterday to reach fresh highs at 1.3080, amid market speculation that the UK government would be requesting to maintain the single market for a transitional period beyond May 2019 to negotiate the terms of a new trading relationship.  At London market opening times, the GBP/USD is trading at 1.3040.

USD/JPY finds support at 108.50. Dollar reversal from 110.00 area on Tuesday found support yesterday at 108.50, and the pair picked up towards the 109.00 area, favoured by an improved market sentiment. At London market opening times, the USD/JPY is trading at 108.95.


In the Calendar Today

At 09:00 GMT we will be attentive at the second reading of the Eurozone Q2 Gross Domestic Product. Previous estimations showed that the economy grew at a 2.2% pace in the second quarter. A relevant revision of these figures might have some impact on the euro.

At 11:45 GMT all eyes will be on the ECB’s monetary policy decision and particularly the ensuing press release. Investors will be eager to have some clues over the bank’s plans to reduce its QE  program. Any comments on that line will increase euro volatility.

09:00 GMT       EZ: Gross Domestic Product (YoY) (Q2)
Prev: 2.2%       Cons: 2.2%

 12:30 GMT      ECB: Monetary policy decision
Prev: 0%       Cons: 0%

 12:30 GMT      ECB: Monetary policy statement


Currency forecasts Q3


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