Article Highlights

  • ECB Gov Draghi: No plans for more cuts
  • ECB to explore non-traditional easing instruments
  • U.S. initial jobless claims at 259K vs. 272K expected
  • Business NZ manufacturing index down from 58 to 56 in Feb
  • Japanese BSI manufacturing index fell from 3.8 to -7.9 in Q4
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Just when it seemed as though the euro was in for a deeper forex selloff, the ECB press conference took place and triggered a massive reversal.

Major Events:

ECB press conference – Just moments after Governor Draghi announced a huge batch of easing measures, which included several rate cuts and an expansion of their QE program, he pointed out during the press conference that this might actually be the last of ’em rate cuts.

According to Draghi, this stimulus plan should reinforce the momentum in the euro zone economy and given this outlook, he doesn’t see the need to lower rates again in the near future. Although he also said that interest rates might remain at these low levels for a long period of time and that the ECB could consider other non-traditional easing options, euro forex pairs were already busy erasing their previous losses then.

Crude oil down… again! – With the much-anticipated meeting between oil-producing nations coming up, analysts have started giving their predictions for the event. According to a report on Reuters, some countries are actually reluctant to send representatives to the huddle, fearing that they might be forced to take a deal right there and then.

In particular, Iran hasn’t even sent its RSVP yet while other Gulf states appear to prefer postponing the meeting to April. One of the sources familiar with the matter noted that there won’t be much progress unless Iran participates. WTI crude oil dipped close to the $36/barrel level upon seeing these headlines while Brent crude oil fell slightly below the $40/barrel mark.

Major Currency Movers:

EUR – The euro saw a lot of whipsaw action during the ECB press conference, as forex traders focused on the part where Draghi talked about having no plans to lower rates again.

EUR/USD popped up from a low of 1.0823 all the way up to a high of 1.1218, EUR/JPY bounced off a low of 123.66 to a high of 126.67, EUR/GBP tested the .7650 mark then rallied up to the .7850 area, and EUR/AUD surged by around 600 pips from 1.4467 to test the 1.5000 levels.

CAD – The Loonie gave up a bit of ground when crude oil chatter hit the airwaves. USD/CAD landed back above the 1.3300 handle to close at 1.3343, CAD/JPY hit resistance at the 86.00 handle to close at 84.74, and AUD/CAD bounced off the .9900 handle to a high of .9956.

See also:

Asian Session Recap

London Session Recap

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