Draghi steals the show

Yesterday’s markets

28th April 2017

  • JPY - BOJ Press Conference
  • AUD - RBA Gov Lowe Speaks
  • EUR - ECB Press Conference

The ECB took center stage yesterday as President Mario Draghi lead the all-important ECB press conference and the central bank announced their latest rate decision. Draghi kept his rhetoric “intentionally” uninspiring for investors, as he said the ECB have “no need to rock the boat” and are not in any hurry to act whatsoever. Draghi was slightly upbeat in his economic outlook. However, this seems like a plan to prepare the market for further QE tapering later this year. As expected, the ECB left rates unchanged, however tapered QE by €20bn.  

Geo-political concerns continued yesterday as Trump said that he sees the chance of a “major, major conflict” with North Korea over its nuclear program. Trump praised China’s President Xi Jinping for his handling of North Korea, calling him “a very good man” who loves his country. China are expected to impose sanctions on North Korea if it conducts further nuclear tests, according to US Secretary of State Rex Tillerson. If tensions continue to grow with North Korea and the world, we could see a strong flow to the safe haven currencies. 

Today’s markets

27th April 2017

  • GBP - Prelim GDP q/q
  • CAD - GDP m/m
  • USD - Advance GDP q/q

The week ends with attention on the first readings of the UK and US economic growth for the first quarter of 2017.  Many investors will look to see if the UK’s Brexit vote will indeed slow growth for the start of this year, and if it fails to meet the expected 0.4% reading.  For the US, growth is due to come in at around 1.3% and will no doubt see volatility for the Greenback if the figure is above or below this.  The yearly inflation figure from the Eurozone is forecasted to increase to 1.8% and creep closer to the ECB’s target of near 2%.