ECB: Tweak in policy rate forward guidance? - TDS

Sandeep Kanihama FXStreet Contributor

According to analysts at TD Securities, the ECB threatened to put all policy levers on the table this week, but they are looking for a simple announcement of generous TLTRO terms.

Key Quotes

“We see risks the ECB could tweak policy rate forward guidance, however.”

“Rates: Generous TLTRO terms support tighter EGBs vs Bunds spreads. Any intention to cut rates could push bunds below the -25bps mark. We continue to favor steepening bias for the curve expressed via 5s10s EUR IRS steepeners.”

“FX: This outing may be more about the financial plumbing but a dovish shift would cap recent gains and put fresh downside EUR risks sub 1.11 back into view. With the USD now on the defensive amid Fed rate cut hopes, our hawkish scenario could see EURUSD break into a new trading range above resistance near 1.1325.”

Author

Sandeep Kanihama

FXStreet Contributor

Sandeep Kanihama is an FX Editor and Analyst with FXstreet having principally focus area on Asia and European markets with commodity, currency and equities coverage. He is stationed in the Indian capital city of Delhi.

EUR/USD faces next resistance near 1.1930

EUR/USD has surrendered its earlier intraday advance on Thursday and is now hovering uncomfortably around the 1.1860 region amid modest gains in the US Dolla. Moving forward, markets are exoected to closely follow Friday’s release of US CPI data.

GBP/USD inching closer to 1.36

The Pound Sterling edged higher to 1.3640 on Thursday, recovering from an earlier pullback after stronger-than-expected US jobs data initially weighed on the pair. The Bank of England held rates at 3.75% at its February 4 meeting in a narrow 5-4 vote split, with four members preferring a 25 basis point cut to 3.50%.

Gold falls to near $4,900 as selling pressure intensifies

Gold price faces some selling pressure around $4,910 during the early Asian session on Friday. The yellow metal tumbles over 3.50% on the day, with algorithmic traders appearing to amplify the precious metal’s sudden drop. Traders will closely monitor the release of the US Consumer Price Index inflation report for January, which will be released later on Friday.

Ethereum investors face huge unrealized losses following price slump

US spot Ethereum exchange-traded funds flipped negative again on Wednesday after recording net outflows of $129.1 million, reversing mild inflows seen at the beginning of the week, per SoSoValue data. Fidelity's FETH was responsible for more than half of withdrawals, posting outflows of $67 million.

A tale of two labour markets: Headline strength masks underlying weakness

Undoubtedly, yesterday’s delayed US January jobs report delivered a strong headline – one that surpassed most estimates. However, optimism quickly faded amid sobering benchmark revisions.

Aster Price Forecast: Demand sparks on Binance Wallet partnership for on-chain perpetuals

Aster is up roughly 9% so far on Thursday, hinting at the breakout of a crucial resistance level. Aster partners up with Binance wallet for the second season of the on-chain perpetuals challenge.