10.09.2019: Markets await ECB stimulus (EUR, USD, GBP, CHF)

10.09.2019: Markets await ECB stimulus (EUR, USD, GBP, CHF)


Traders are waiting for the European Central Bank meeting results that are due on Thursday. The regulator is expected to adopt financial stimulus package to tackle the consequences of trade tensions between the US and China and a slowdown in global economy. The measures are also supposed to eliminate risks connected with Brexit. Moreover, traders expect the Federal Reserve to reduce the interest rate following a meeting next week in order to minimize risks to the global economy. The pound holds steady against the US dollar below the peak of 1.2331 as the UK parliament voted against Boris Johnson’s initiative on snap elections. This decision is supposed to force Johnson to sign an agreement on a Brexit deal during the the EU October summit. Meanwhile, traders prefer to buy the pound following yesterday’s joint press conference of British and Irish prime ministers. Boris Johnson announced his intention to reach an agreement by October 18. Market participants appreciated Johnson’s comment on no-deal Brexit being a failure. The euro traders are focused on the upcoming ECB meeting. European stocks are falling while the euro/dollar pair is trading sideways at the level of 1.1042, having retreated from the recent high at 1.1067. A short-term uptrend movement was driven by Reuters news about Germany’s plan to establish
independent state agencies. These state structures are expected to increase the volume of financial incentives without violating the strict budget rules stipulated
by the constitution. Meanwhile, the Swiss franc has receded to 5-week lows amid the increased risk appetite. Market sentiment improved slightly amid the news from Germany and growing hopes on improvement in the US-China trade dispute. The franc has dropped by 0.01% against the US dollar. The dollar/franc quotes have reached the level of 0.9920. Investors are hoping for a positive change in the trade dispute between the US and China. Treasury secretary Steven Mnuchin confirmed that US officials were still determined to enter into a deal with Beijing. The next round of high-level talks will be held in early October in Washington. We will continue to monitor situation on the market. Stay with us!

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