Speeches from ECB members to provide euro direction

The US dollar continues to gather strength against its counterparts after the outcome of the FOMC meeting where the Federal Reserve decided to keep rates on hold. Markets are a bit choppy and range traded as further comments coming from Fed Members shows a stark divergence. On Friday, Fed Member Rosengren stressed on the fact that he would have preferred gradual tightening, now differing from the FOMC decision. However, another Fed Member Kaplan, stressed that the US could do with a little more sustained accommodative policy. This is despite the fact the Federal Reserve tried to be modestly hawkish by opening the door for an interest rate hike, possibly in December. Investors are of the opinion that they will not act close to the US General Election which culminates in 6 weeks. On the economic calendar today, US data comprises of New Home Sales and the Dallas manufacturing data print.
 
Another quiet week from Eurozone
 
It was another quiet week from the Eurozone, with little data of importance to be released this week. However, investors will be looking towards ECB President Mario Draghi’s speech later today in the EU Parliament on the measures the Central Bank will take for future monetary policy. There is also a Panel Discussion on banking to be held with ECB Member Nowotny. This week could bring about some volatility for the euro as there are a spate of 9 speeches from ECB members between Monday and Thursday. Accommodative monetary policy is set to be the mostly likely theme with a further dovish outlook expected for the near term. Similarly, the UK Pound remains subdued with sustained weakness on the back of comments from leaders advocating for a hard Brexit and the possibility of the UK leaving the EU and giving up passporting rights. With little data of note, focus will be on the BBA Mortgage approval data from the UK for further direction.

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