Yesterday’s main highlight was the European Central Bank announcement. The central bank broadly kept its policies the same but did tweak one element. In response to the recent sharp rise in global bond yields, which have pushed up borrowing costs, the ECB announced they will increase the pace of purchases over the next quarter. The aim is to prevent yields from rising as they mop up any oversupply from the market.
The euro’s response to the announcement was a positive one. EURUSD edged closer to the $1.20 level which it broke to the downside last week. GBPUSD was also dragged higher which kept the GBPEUR cross relatively stable. The ECB additionally increased its GDP and inflation forecasts for 2021 and 2022, providing support to the single currency.
Today’s economic calendar sees a focus on UK January growth numbers as well manufacturing and industrial production. From the US, producer inflation data will be on tap as well as consumer sentiment numbers.
Have a good weekend.
8:16am, March 12th 2021
The details expressed in this market report are for information purposes only and are not intended as a solicitation for funds or a recommendation to trade. Cornhill International Payments limited accepts no liability whatsoever for any loss or damages suffered through any act or omission taken as a result of reading or interpreting any of the above information.