European central bank to push ahead with QE
This morning will see the EU’s economic forecasts released, which will give the markets an idea of how much optimism surrounds the varying member states. Further clarity of exactly where the health of the region is will be given tomorrow morning when a plethora of countries post their latest services purchasing managers index figures.
The noise created from these economic updates can lead the market into distraction from time to time, as the recent rally in EUR/USD highlights. The pressure that will undoubtedly return as the European central bank (ECB) continues to press ahead with the European version of quantitative easing (QE) will ultimately tell on the euro and renewed effort to break to lower lows will materialise. The bottom line is €60 billion of QE on a monthly basis weakens the euro and, as the Federal Reserve required three attempts at QE before they felt it was successful enough, there is every likelihood that the current end date in September will not be met by the ECB.