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According to Futures News on December 19, the holdings of the worlds largest gold ETF, SPDR Gold Trust, remained unchanged at 1,052.54 tons from the previous trading day.Japans core CPI rose 3% year-on-year in November, in line with expectations and unchanged from the previous month.On December 19, UN Deputy Spokesperson Haq stated that the Houthi rebels in Yemen had detained 10 UN staff members in the capital Sanaa, bringing the total number of UN staff members detained by the group to 69.Japans November core CPI annual rate will be released in ten minutes.1. All three major U.S. stock indexes closed higher. The Dow Jones Industrial Average rose 0.14% to 47,951.85 points, the S&P 500 rose 0.79% to 6,774.76 points, and the Nasdaq Composite rose 1.38% to 23,006.36 points. Amazon rose more than 2%, and Nvidia rose nearly 2%, leading the Dow Jones. The Wind U.S. Tech Big Seven Index rose 1.69%, Tesla rose more than 3%, and Facebook rose more than 2%. Most Chinese concept stocks rose, with BOSS Zhipin rising more than 5% and XPeng Motors rising nearly 3%. Micron Technologys strong earnings report boosted market confidence and helped major stock indexes rebound after consecutive declines. 2. European stock markets closed higher across the board. The German DAX rose 0.85% to 24,164.71 points, the French CAC40 rose 0.8% to 8,150.64 points, and the UK FTSE 100 rose 0.65% to 9,837.77 points. The European Central Bank kept interest rates unchanged, Germany shifted towards a more accommodative fiscal policy, and moderate inflation expectations improved market risk appetite. 3. US Treasury yields fell across the board. The 2-year Treasury yield fell 2.08 basis points to 3.460%, the 3-year yield fell 2.78 basis points to 3.497%, the 5-year yield fell 3.84 basis points to 3.662%, the 10-year yield fell 3.31 basis points to 4.120%, and the 30-year yield fell 2.43 basis points to 4.802%. 4. International precious metals futures generally closed lower. COMEX gold futures fell 0.23% to $4363.9 per ounce, and COMEX silver futures fell 2.17% to $65.45 per ounce. US President Trump is expected to sign a defense bill and consider a housing emergency. Federal Reserve officials hinted at a possible interest rate cut, while the European Central Bank kept interest rates unchanged. 5. International oil prices rose slightly on the 18th, closing at $55.9 per barrel; Brent crude oil futures rose 0.12% to $59.75 per barrel.

EUR/GBP Rebounds from 0.8400 on ECB-BOE Divergence

Larissa Barlow

Apr 26, 2022 10:06

The EUR/GBP pair is reversing course from 0.8400, following a precipitous plunge from Monday's high of 0.8440. The pair has remained firmer in recent trading days, despite the European Central Bank's (ECB) President's speech at the International Monetary Fund (IMF) meeting adopting a dovish position.

 

The ECB's officials do not anticipate a rate hike until its Asset Purchase Program is completed (APP). The central bank has stressed the importance of lowering growth expectations in light of the Ukraine crisis and a large decline in household real income due to increasing energy costs and commodities prices. The circumstances need a stagflationary situation in the eurozone. Meanwhile, investors are focused on Wednesday's speech by ECB President Christine Lagarde. The speech will set the stage for the monetary policy narrative that will be dictated in the policy announcement.

 

Meanwhile, Bank of England (BOE) Governor Andrew Bailey rekindled fears of increasing inflation in the pound area during his testimony on Thursday. As per his directive, investors should begin bracing for a further increase in inflation, which might result in higher interest rates.

 

Although the ECB's Christine Lagarde's speech on Wednesday will be crucial, investors will also be focused on Thursday's eurozone Consumer Confidence report. Euro Consumer Confidence is -16.9, unchanged from its previous close.

EUR/GBP

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