US dollar mixed on growing anticipation of a taper announcement next week

December 12, 2013

Frankfurt (Dec 12)  The euro is also very flat in the Asian session, with most of the move coming from the EUR/JPY rally.  Today we have Draghi speaking early on about the ECB policy, then the ECB monthly bulletin explaining how they reached the decision to leave rates unchanged. What to look for here is any mention of negative rates as that seems to be the next possible move  from the ECB and when this could be applied.

The US dollar is looking mixed this morning, being weak against EUR and GBP but strong against AUD and JPY.  Today’s data is retail sales, which is expected to climb slightly and at this time of year it could possibly be higher giving some strength to the dollar. Then there will be the unemployment claims, which are expected to be higher than last but recent good data out with non-farms being higher on Friday makes both these figures important releases today as they will likely add to the speculation of a taper to next week’s FOMC announcement.

Also keep an eye on the SNB Libor rate announcement with monetary policy assessment and then a press conference, worth to keep your eyes on the CHF and comments made likely to cause some action here with the peg still in pace for the EUR/CHF at 1.20 and currently around 1.22, with some suggestions of lowering their inflation forecasts.

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