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ECB Weighs on the Euro--New York Summary

Posted by Joseph Trevisani on Feb 12, 2014 6:17:00 PM

The euro opened in  New York at 1.3577 just over its earlier low at 1.3564, which had been the bottom of a hour long decline from 1.3639 caused by ECB Board member Benoit Coeure's comment in a Reuters interview that the ECB is seriously considering negative interest rates, compounded by a Market News International story that Greece is likely to miss the February deadline for its EU restructuring.

With only mortgage applications in U.S. data (February 7 week -2.0%) and retail salespending  tomorrow at 8:30 am (provided Federal offices are not closed by snow) there was little for traders to chew on and the euro stayed between 1.3562 and 1.3580 until 10:30 am.  The St Louis Fed President James Bullard's comment that the drop in jobless rate will force the Fed into more traditional policies had no effect on the markets.

Euro/sterling selling forced the currency to 1.3562 where it met euro/yen interest and general bids before 1.3560. ECB President Mario Draghi speaking in Brussells did not mention monetary policy and the euro, perhaps in relief, moved up to 1.3598, aided by short covering.  The rally failed to breech 1.3600 and faded to 1.3580, though it made two more unsuccessful attempts later in the afternoon before closing at 1.3592.

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ScreenHunter 2142 Feb. 12 18.51


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