-
EURUSD Reversal Signs
A slew of weaker-than-forecast eurozone inflation data this week has put an end to the rally for now. With Spanish, German and overall eurozone CPI seen falling again last month, the market has now moved to fully price in an ECB rate cut by April next year with odds for a March cut reflecting a high degree of risk that the bank moves early on easing monetary policy. The ECB has consistently pushed back against those calling on a rate cut early next year, citing remaining inflation risks. However, judging by money market movements it seems that traders are calling the bank’s bluff and perhaps reading its insistence ... (full story)