1. DM

    ECB summary and implications for EUR/USD

    Without bragging too much, I'm happy to say Mario Draghi delivered most of what I had expected at today's ECB policy meeting, and more: Cut in the deposit rate by 10 basis points to -0.5% from -0.4%. Introduction of a two-tier system that exempts part of banks' excess liquidity from the...
  2. DM

    Preparing for the ECB: Fixed income or fixed loss securities?

    Tomorrow will be an important day for investors in foreign exchange: In its most anticipated meeting in months, the European Central Bank is expected to announce a package of fresh stimulus measures, including another cut in its deposit rate, a renewal of its bond buying programme as well as a...
  3. DM

    What does NIRP mean?

    The acronym NIRP refers to "Negative Interest Rate Policy". It is a monetary policy tool employed by central banks to support the economy during a financial crisis - at least in theory, that is. The idea being that, if interest rates on savings are negative (or at the lower bound of zero for...
  4. DM

    The week ahead in FX: 9-13 September 2019

    The main event of the coming week will be the European Central Bank's meeting on Thursday, 12 September. Mario Draghi is widely expected to announce a 10-15 basis point rate cut and perhaps even a renewed bond buying programme. These actions are far from certain, however, making Thursday a risky...
  5. DM

    German recession fears and negative interest rates

    The risk sentiment has become much more positive in recent days, against the backdrop of a possible continuation of trade talks between China and the USA, easing tensions in Hong Kong and resistance to Boris Johnson's hard Brexit course. However, the situation remains very fragile: Germany...
  6. DM

    ECB's Mersch on "private currencies" and Facebook Libra cartel

    In a recent speech held during the European Central Bank's Legal Forum in Frankfurt, ECB Executive Board Member Yves Mersch criticised private currencies and especially Facebook's Libra. Mr Mersch focussed on three main points: How is Libra different from other private currencies and from...