EUR/USD
As can be expected, the focus for the pair was very much placed upon the ECB rate decision. Despite a slew of Eurozone PMI Services releases, which came in relatively mixed, the pair resided in a relatively tight range ahead of the announcement. Today the ECB decided to keep all rates on hold as expected. However, there were some outside bets placed by analysts for a rate cut today and as a result upon the news, EUR did see some strength amid an unwinding of dovish bets before largely paring the move. Following this, attention then turned to the accompanying press conference whereby initially the market appeared to react to the fact that nothing particularly new (further easing) was mentioned in the opening statement alongside the fact the ECB sees prolonged period of low inflation followed by gradual upward movement, dispelling any fears of imminent deflation. This consequently provided the pair with some upside, however these gains were then pared and extended into losses as Draghi revealed the governing council has discussed several easing type options including QE, cutting rate/deposit rate, SMP sterilisation, long term financing operations and lowering the corridor for ECB rates. This ultimately cemented the pairs price action and ensured the pair finished the session in negative territory.
GBP/USD
The main data point out of the UK today was that of the services PMI which came in lower than expected and consequently weighed upon GBP due to the importance of the services sector to the UK economy. This move consequently erased any earlier strength for the pair following rhetoric form BoE governor Carney saying interest rates could increase ahead of next general election. With the pair already trading with losses and a lack of newsflow out of the UK, the main event for the pair was that of the aforementioned ECB rate decision and accompanying press conference hosted by Mr Draghi. As already discussed, the conference proved to be EUR negative following the discussions over further easing measures, which led to board-based strength for USD with the USD index trading with formidable gains. This consequently saw USD further out-muscle GBP and saw the UK currency finish the session at a loss to that of the US
USD/JPY
Asia-Pacific trade saw a significantly weaker JPY following a record high close on Wall Street which filtered through to Japanese equities and led the pair above the key psychological 104.00 handle. The pair traded in a relatively narrow range as European participants entered the market, although did see a further extension as interest differential flows came into play. As was the case across most FX pairs, one of the main sources of price action came from the ECB announcement today which as already discussed saw a strengthening of USD and thus provided another source of support for the pair. However, in the latter stages of the session a move lower in EUR/JPY did filter through to the pair and saw a retracement of earlier gains and saw USD/JPY finish the session relatively unchanged.
Recommended Content
Editors’ Picks
AUD/USD holds above 0.6500 in thin trading
The Australian Dollar managed to recover ground against its American rival after AUD/USD fell to 0.6484. The upbeat tone of Wall Street underpinned the Aussie despite broad US Dollar strength and tepid Australian data.
EUR/USD comfortable below 1.0800 lower lows at sight
The EUR/USD pair lost ground on Thursday and settled near a fresh March low of 1.0774. Strong US data and hawkish Fed speakers comments lead the way ahead of the release of the US PCE Price Index on Friday.
Gold price finishes Thursday’s session set to reach new all-time highs
Gold price rallied during the North American session on Thursday and hit a new all-time high of $2,225 in the mid-North American session. Precious metal prices are trending higher even though US Treasury yields are advancing, underpinning the Greenback.
Bitcoin price extends retreat from $69K as old whales shift their holdings to new whales
Bitcoin price continues to move further away from the $69,000 threshold, gaining ground as BTC bulls hope for a retest of the $73,777 peak. This is because of the general assumption that clearing this blockade would set the tone for a reach higher, marking a new all-time high.
Bears have been standing before a steamroller so far this year
Despite a pushback on rate cuts from Christopher Waller, and what was supposed to be cautious trading sentiment ahead of critical US inflation data released later on Friday, the S&P 500 rose on Thursday, marking its best first-quarter performance in five years.