This morning’s speech from Mario Draghi was eagerly awaited by traders and it didn’t disappoint with a number of dovish remarks. He noted that the ECB must do what they must to raise inflation quickly and that the economy needs more aid if recovery is not self-sustaining. This added further hints to the likelihood of an interest rate cut and extension of QE and as a result the euro has sold off across the board.
This morning’s public sector net borrowing figures came in worse than expected but better than last month, expected at 5.3 billion, previous 8.3 billion and the actual figure 7.5 billion. The same scenario occurred with public sector borrowing excluding banking groups, previous 9.1 billion, expected 6 billion and actual 8.2 billion.
This afternoon we saw the release of Canadian CPI which came in at the expected figure of 1% and the core CPI slightly better at 2.1%. There was no major impact on CAD off the back of this. Next week sees the release of many PMI and GDP figures with a volatile one expected.