The main currency pair is dropping on Tuesday, after a rather successful rally up – there are not enough factors of support, and statistics are volatile.
On Tuesday morning, the euro was successfully growing, but with the return of European investors to the market, the major currency pair came under sale. Lots of today's session is marked at the level of 1.1280, with the minimum at 1.1220.
Not much statistics were released. Germany has had time in the morning to report the levels of import prices for August. The release showed a drop in the indicator of 1.5% m/m (-3.1% y/y) - Statistics are in line with expectations, but that does not make it pleasant. The index of business climate in the euro area in September was 0.34 points with the forecast of 0.20 points. The figures for August were revised simultaneously with a slight deterioration.
We were pleased with Spain, whose retail sales for August gained 3.1% y/y – this did not match the forecast, and was a little behind, but it is an excellent report the country.
Investors continue to analyze yesterday's comments of a representative of the European Central Bank, Mrs Lautenschläger, who noted that it was premature to talk about the need to expand the QE program in the eurozone. Do recall that at the moment the monthly weight of QE is 60 billion euros, the program is running from March 2015 and is already yielding a positive effect the economy. These comments came just in time - two large investment funds, including PIMCO, recently did not rule out that the incentive program will have to increase in volume in the near future. The reason is the low European inflation, which so far could not be fixed.
It is clear that the opinion of one of the members of the ECB is not the position of the regulator. But the confidence of the central bank in the correctness of the current strategy is also important.
RoboForex Analytical Department
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