Thursday, May 3, 2012

The market was pricing expectations of a possible lower interest rate today, but the ECB has kept it at 1%, adding that the central bank’s officials didn’t discuss the rate at all today: “Those comments fell short of expectations for more dovish ECB language or indication that the central bank was moving closer to further easing”, wrote Nick Bennenbroek, head of currency strategy at Wells Fargo Bank, pointing to the rebound of the euro, also helping the CHF and NOK.

“ECB President Draghi said the inflation risks were broadly balanced and that risks to the economic outlook were to the downside, while he also said the central bank did not discuss a rate cut at today’s meeting”, Bennenbroek added.

In the US, initial and continuing jobless claims surprised the market with a 27k and 53k drop, respectively, now at a total of 365k and 3.276M. Falling productivity by -0.5% in Q1 (YoY) and rising labor costs by 2% were also revealed today.

source: fxstreet.com
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