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Week Ahead: BoC, RBNZ, China, Risk Test, EUR Post-ECB, Short EUR/GBP
Risk sentiment should remain vulnerable to further setbacks. Few central banks besides the dovish ECB look to be willing to support the markets. What’s more, the Fed still seems on course to hike rates, and we see the recent market turmoil mostly as a temporary setback. China will continue to cast a long shadow over the markets as well, with fears of a hard landing in the world’s second-largest economy and a global demand shock depressing risk appetite. The dovish ECB statement was a clear indication that the Governing Council will not be a mere bystander in the global currency wars. More central banks could join ... (full story)