ECB’s bazooka should be more powerful than Fed’s one

By GG Analyst in Reviews 0 Comment

EUR/USD

Though neither the Fed nor the ECB have decided on whether to expand their balance sheets or not, the markets already see it as a settled thing for both the CBs. Yet, Europe needs asset purchases much more than the USA. Provided the ECB and the Fed followed the same rules to help their economies (or are ruled by same people), we would see a much bigger decline in the euro. For comparison, the EU economy has shrunk by 0.4% against the level of the previous year, while the US economy demonstrates a 2.2% growth. The unemployment rate in the euro more…

If no growth, then a fall

By GG Analyst in Reviews 0 Comment

EUR/USD

Judging by the newspaper headlines of the beginning of the week, it looks as though the situation had come under control of Draghi since Germans have become more yielding in regard to the issue of common bonds. Since then the markets haven’t seen any significant details on this. Most of the markets have been trading sideways, each time fearfully bouncing off the highs. But the euro has been methodically giving up its positions after Wednesday’s highs. Basically, diversity in the performance of currencies with equal reaction to risk demand is not a frequent case. Very often, this doesn’t last for long more…

Up… but with caution

By GG Analyst in Reviews 0 Comment

EUR/USD

S&P revised down Greece’s rating outlook to ‘negative’. Remember that after private loan restructuring the outlook was ‘stable’. It’s all about renewed issues with getting tranches from the IMF. The latter is currently putting an intense pressure on the ECB, urging it to restructure Greece’s debts, belonging to the Bank. The European Commission, seeing the deterioration of the outlook for Greece, couldn’t put up with the revision of the initial economic targets (the debt-to-GDP ratio at 120% by 2020). And it means that this level can be achieved only by artificial reduction of the debt load. Anyway, the news concerning other more…

EUR will grow if Italy and Germany don’t quarrel

By GG Analyst in Reviews 0 Comment

EUR/USD

The market was rather anemic yesterday: there weren’t any vital economic releases and some local markets were closed. The Forex market performed in the corresponding way. Having started the day with recouping of Friday’s optimism (max 1.2443), the single currency dropped down at the heated EU session (min 1.2341). However, by the end of trading the pair returned right to the opening levels, i.e. 1.24. Tuesday promises to be an eventful day. Looking at the EU statistics, Factory Orders are worth considering. The release will bring data for June, when the single currency was steadily trading below 1.30. On the one more…

EUR in demand on strong US statistics

By GG Analyst in Reviews 0 Comment

EUR/USD

Our forecast that the US statistics would go beyond expectations proved to be true. However, the following reaction was absolutely different. Cutting off the initial downward impulse in EUR/USD, the euro has already grown by 2 points from 1.22 to 1.24. At the opening of the Asian session the demand for the euro enabled the pair to hit a high at 1.2443. The impressive US statistics inflamed risk demand. Despite the employment growth from 8.2% to 8.3% in July, the number of jobs increased by 163K last month. Remember that the average market forecast was 100K, and the maximal estimated level more…