FXStreet (Delhi) – Research Team at BNP Paribas, suggest that in the forthcoming ECB meet on Thursday, there are 40% chances of a surprise policy change and shorting the Euro against the GBP and USD will be a good strategy.
Key Quotes
“They continue to see December’s meeting as the most likely timing of an extension of the asset purchase program. With President Draghi likely wary of encouraging renewed tightening of financial conditions, we expect him to make a good deal of effort at his press conference to go beyond the already dovish message delivered at the September meeting. This could include confirmation that new measures were discussed or an emphasis on the importance of new staff projections to be available in December.”
“Our rates strategy team notes there is scope for rates markets to price more risk of further deposit rate cuts deeper into negative territory and recommended buying the EUR front-end in their latest weekly. We added a short EURUSD recommendation from 1.1450 on Thursday to our existing EURGBP short from 0.7395. The latter trade may get additional benefit from solid UK September retail sales data Thursday.”
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