No planned Euro-Zone rate hike for 12 months
|We had unexpected € weakness last week, after the ECB announced it will end QE in December and hold interest rates until the middle of 2019. Rate hikes are the big watch every month for investors and the main economic data that will provide either strength or weakness for a currency. So future ECB meetings will not provide as much volatility as seen over the years.
As expected though, the US raised interest rates and gained yet more ground across the board. The Fed mentioned another two are coming this year, but this sounds very unlikely. The $ continues to perform and may push the 1.30 barrier, if Brexit talks fail to encourage.
Thursday's BoE meeting is curious, as it could go either way for talks on a rate hike in August. The recent disappointing wage figure may have dented chances of one, although strong retail sales data was a welcome break for £. We should hear from Theresa May this week on news of the upcoming EU deals that need to be made. This could come out at anytime, but investors will be holding out for the all-important EU summit next week.
I hope you are all enjoying the World Cup and the controversial (but good?) performance of VAR. I am going for a 2-0 England victory tonight!