Europe FX Handover – 21st March 2019

  • Dollar pared losses following yesterday’s dovish FOMC meeting, with EUR/USD easing back below 1.14 handle after almost reaching 1.1450 the day before.
  • GBP/USD hit its lowest level on the week despite more good news from UK economy as retail sales unexpectedly climbed 0.4% m/m.
  • Fears over a hard Brexit intensified as concerns were raised that the EU might not grant an extension to June 30 unless May’s deal was passed in parliament.
  • Swiss National Bank held benchmark interest rates unchanged at -0.75%
  • Norges Bank hiked rates by 25 basis points as expected but signalled another 0.25% hike for the 2nd half of 2019 and 2 more increases in 2020. It upgraded its growth forecasts and 2019 core CPI. EUR/NOK slumped from around 9.6900 to below 9.5900.
  • Bank of England policy decision was a damp squib event due to Brexit. The BoE said monetary policy in response to Brexit, whatever form it takes, will not be automatic and could be in either direction.
  • Despite the dovish Fed, US index futures pointed to a downbeat open on Wall Street, after a lacklustre EU session for stocks.


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