The European Central Bank announced its latest monetary policy decision yesterday afternoon, followed by a Draghi led Press Conference. Firstly, the ECB as expected, left their main benchmark rate unchanged at record lows of 0.00%. However, Draghi announced that the ECB will extend its asset purchase programme by nine months to the end of 2017 or beyond. The ECB President went on to say that the bond buying programme will be cut by €20bn a month, helping to cap Euro’s losses yesterday afternoon.
The British Pound continues to be under pressure as markets react to the news that a potential rescue package for the Italian banking sector is on the cards. Sterling is the worst performing currency amongst its group of ten peers this week. The news was sparked by a recent article in the Italian Newspaper La Stampa, which stated that the country could ask for a €15bn European Stability Mechanism loan, a loan which should settle investor’s nerves surrounding Italy and the Eurozone.
We finish the week with a relatively light economic docket. The only notable piece of high tier data comes from the States in the form of the University of Michigan Consumer Sentiment. The UoM Consumer Sentiment measures the level of current and future economic conditions as based on surveyed consumers. The figure is expected to tick slightly higher than last month’s 93.8 to 94.3 which would mark a seven month high.