A quick look into the ECB Press Conference which took place on Thursday the 9th of September, 2021.
ECB's Pandemic Emergency Purchasing Programme (PEPP) is likely between €60-70 billion per month
Lagarde says this is not tapering
Inflation upgraded, still below mid-term target
High vaccine rates bolster eurozone recovery
As expected, the ECB stood pat on rates and held the size of its PEPP envelope at €1.85T. The key adjustment to the policy statement was that purchases under PEPP were to be conducted at a “moderately lower” pace compared to Q2 and Q3; some commentators have suggested this would equate to around €60-70B p/m vs current circa €80B.
At the follow-up press conference, President Lagarde noted that the Euro area economic rebound is in an increasingly advanced stage, and output is set to exceed pre-pandemic levels by the end of this year.
Subsequently, for the accompanying economic projections, the central bank’s 2021 growth forecast was upgraded from 4.6% to 5.0%, with the base-effect spill over resulting in a minor tweak lower to the 2022 growth view, from 4.7% to 4.6%, while 2023 growth view was left unchanged at 2.1%.
The ECB still characterises inflationary pressures as transitory, however, its 2021 inflation projection was lifted from 1.9% to 2.2%, 2022 CPI forecast was raised from 1.5% to 1.7%; 2023 was revised up a touch from 1.4% to 1.5%, and thus it still sees inflation below target at the end of its forecast horizon.
Lagarde went on to state that the decision to slow purchases, and the wording in the statement, was unanimously agreed. For those looking for clues on “life after PEPP”, the President remarked that discussion will take place at the December meeting.
That said, Lagarde reassured markets that when PEPP "was done,” the job of the ECB would still not be complete, as the Governing council attempts to reach its inflation mandate.
Overall, Thursday’s release failed to deviate much from market expectations, with the ECB slowing purchases in Q4 and refraining from giving much in the way of clues as to how PEPP will most likely transition into a beefed-up annual payment plan.
I've been sharing my thoughts on E/U over the past couple of weeks, and have been pointing out the bearish order block underneath 1.19, which we did indeed see price reverse from a couple days ago.
Currently, we're seeing price hold just underneath this medium-term descending channel where we're now waiting on further confirmations as to where price could be heading next.
If price continues to stay below the channel's top, and slowly push lower, it's likely we could see the trend continue and price head towards the channel's bottom. If we do see yet another break higher, the order block will become a breaker block, and essentially an area to go long from.
AI- Generated Trading Setups
AI-generated bullish/bearish bias setups on forex currencies, gold, & indices.
News in the US takes a break this week, but key numbers come out in China that will help set the tone of where demand lies in the commodities market. We will have PMI news on Thursday so here are some setups to look for pre-data combined with EdgeFinder sentiment. EdgeFinder Analysis Gold is now […]
This morning, the US will release their latest services and manufacturing PMI data. Here is what a higher or lower number could mean for USD, indices and gold. EdgeFinder Analysis GBPUSD is now a +9 on the EdgeFinder. This strong bullish reading is helped out by the recent change in the trend reading category that […]
Pound pairs are now a stronger bullish reading on the EdgeFinder than any other currency this week. With PMI data coming in the UK on Thursday, here is what to expect for the GBP pairs in the coming days. EdgeFinder Analysis GBPAUD is the strongest of the GBP pairs today at +7. The score increased […]
DISCLAIMER: All comments made by TraderNick’s Forex Group, LLC are for educational and informational purposes only. All comments should not be construed as investment advice regarding the purchase or sale of any securities or financial instrument of any kind. Please consult with your financial adviser before making an investment decision regarding any securities or financial instruments mentioned by TraderNick’s Forex Group, LLC. TraderNick’s Forex Group, LLC assumes no responsibility for your trading and investment results. All information on any of the platforms utilized by TraderNick’s Forex Group, LLC was obtained from sources believed to be reliable, but we do not warrant its completeness or accuracy, or warrant any results from the use of the information. TraderNick’s Forex Group, LLC, its employees, representatives, and affiliated individuals may have a position or effect transactions in the securities and financial instruments herein and or otherwise employ trading strategies that may be consistent or inconsistent with the provided strategies. Trading of any type involves very high risk and may not be suitable for all investors. TraderNick’s Forex Group, LLC, its subsidiaries and all affiliated individuals assume no responsibility for your trading and investment result. Read our full disclaimer here
There is a significant degree of risk involved in trading securities. With respect to foreign exchange trading, there is considerable risk exposure, including but not limited to, leverage, creditworthiness, limited regulatory protection and market volatility that may substantially affect the price, or liquidity of a currency or currency pair. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. The vast majority of retail client accounts lose money when trading in CFDs. You should consider whether you can afford to take the high risk of losing your money.