Stockpair traders should keep an eye on these events today:
|EUR||German Business Expect|
|EUR||German Current Assessment|
|EUR||German Ifo Business Climate|
|USD||Services PMI (Nov)|
Central Banks Keep Hold Market Attention
November 24, 2014
China cut its benchmark interest rates for the first time since July 2012, stepping up efforts to support the world’s second-largest economy. The move put the People’s Bank of China on the side of the ECB and Bank of Japan in adding stimulus. Draghi said today the ECB needs to accelerate inflation and may broaden its asset-purchase program.
China lowered the one-year deposit rate by 0.25 percentage point to 2.75 percent and the one-year lending rate by 0.4 percentage points to 5.6 percent, effective tomorrow, the PBOC said. Earlier, it was said to have added money to the banking system as a cash shortage stemming from new share sales drove the benchmark money-market rate up by the most since July. The greenback jumped to its highest level in more than four years Friday, boosted by the euro’s declines, as the European Central Bank’s decision to begin buying asset-backed securities weakened investor confidence in the shared currency. The ECB’s purchases of asset-backed securities represent the second leg of the ECB’s quest to catalyze growth by expanding its balance sheet. In September, the central bank began buying covered corporate bonds, which are guaranteed against a company’s assets. The euro slumped versus its peers as ECB President Draghi told the European Banking Congress in Frankfurt that officials “will do what we must to raise inflation and inflation expectations as fast as possible.”
BOJ Governor Kuroda said responsibility for Japan’s fiscal health lies with the government. Consumer prices excluding fresh food slipped in October from a month earlier, according to the median estimate of 28 analysts surveyed before a report next week. Stripped of the effects of April’s sales-tax increase, the central bank’s core measure of inflation was 1 percent in September, a level Kuroda said in July wouldn’t be breached. The yen has fallen too quickly, according to Japanese Finance Minister Taro Aso.