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COZfx: ECB’s interest rates too low for Germany

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COZfx: ECB’s interest rates too low for Germany

Postby dwang » Tue Jul 15, 2014 2:05 am

COZforex: On Friday, EUR marginally declined against the USD and closed at 1.3604, as worries on the troubles in the European banking system continued to weigh on the common currency. However, in order to cool down the anxiety following the Portugal’s Banco Espirito Santo jitters, Portugal’s PM Pedro Passos Coelho, assured that the tranquillity of their financial and banking system will be maintained and that the government would not have to intervene to bail out the largest bank of the nation.

Over the weekend, Bundesbank Chief Jens Weidmann called for the tightening of the ECB’s monetary policy at the earliest, as according to him, the central bank’s interest rates are too low for Germany.

On the economic front, the inflation rate in Germany, on a yearly basis, rise in line with the preliminary estimate in June. The inflation rate in Spain, too followed suit and came in line with expectations in June.

In the US, the Atlanta Fed President Dennis Lockhart, hinted that the US might witness an increase in interest rate in the second half of 2015. He further added that the Federal Reserve needs some more time to decide that whether the recent rise in inflation data would continue and reach near or at the central bank’s 2% target. At the same time, Chicago Fed President Charles Evans echoed Lockhart’s views that the central bank should look into all the factors before deciding when to begin raising short-term interest rates.

However, the Philadelphia Fed President, Charles Plosser urged the central bank to start preparing itself to raise rates soon as the economy is improving and if the rates are kept low for too long then the central bank may lose its credibility.
On the data front, US posted a net surplus of $70.5 billion in June, the largest for any month in five years as compared to $130.0 billion deficit in May.

In technical analysis, COZFX strategist Nigel Boynton said, EUR/USD is predicted to find support at 1.3587 and a drop through could take it to the next support line of 1.3572. Meanwhile, the pair is predicted to find its first resistance at 1.3622, and a rise through could take it to the next resistance line of 1.3642.

Later today, investors would pay attention to what steps would be undertaken in order to curb the growing strength of the Euro, by ECB President Mario Draghi.

(COZ forex UK)
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Re: COZfx: ECB’s interest rates too low for Germany

Postby KerryPrad » Wed Aug 27, 2014 11:25 pm

Bundesbank chief Jens Weidmann had on Saturday complained that the European Central Banks' interests were too low for Germany adding that the interest has upset many savers.Germany is noticeably a giant European economy, as the Bundedsbank Chief advised that ECB monetary policy should maintain expansive nature for no longer than absolutely compulsory; though that there is no reported risk prospect of a price bubble forming.
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Joined: Tue Aug 26, 2014 10:52 am

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