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22 Nov 2013
Flash: EUR/USD driven by Fed and ECB, unpredictable - UBS
FXstreet.com (Córdoba) - Speculation about Fed and ECB policy is the most important driver of EUR/USD at present – a fact that makes the pair unpredictable, according to Lutz Karpowitz, analyst at Commerzbank.
Key Quotes
"While the franc seems increasingly glued to the euro, sterling appreciation seems as certain as further yen weakness".
"At present EUR-USD is mainly driven by difficult-to-project speculation about the monetary policy course of the Fed and ECB".
"A Bloomberg report, according to which the ECB was considering a reduction of the deposit rate to -0.1%, was sufficient to send EUR-USD tumbling".
"At the same time markets are still pretty much in the lurch about the timing of the Fed’s tapering of its bond purchases. Depending on the market’s view the USD receives support or comes under pressure"
"For some time now it has mainly been central bank monetary policy that has driven EUR-USD, with both the Fed and ECB being extremely expansionary. After all both economic areas are in recovery, and considering that fact, key rates of almost zero percent are extremely low".
Key Quotes
"While the franc seems increasingly glued to the euro, sterling appreciation seems as certain as further yen weakness".
"At present EUR-USD is mainly driven by difficult-to-project speculation about the monetary policy course of the Fed and ECB".
"A Bloomberg report, according to which the ECB was considering a reduction of the deposit rate to -0.1%, was sufficient to send EUR-USD tumbling".
"At the same time markets are still pretty much in the lurch about the timing of the Fed’s tapering of its bond purchases. Depending on the market’s view the USD receives support or comes under pressure"
"For some time now it has mainly been central bank monetary policy that has driven EUR-USD, with both the Fed and ECB being extremely expansionary. After all both economic areas are in recovery, and considering that fact, key rates of almost zero percent are extremely low".