Central Banks Stepping Forward6th July, Uk Forex Update
Vantage FX (http://www.vantagefx.co.uk/) provides a daily overview of the news activity and announcements currently shaping currency movements across the world. Jay Mawji, the companys head of market analysis, takes a look at news surrounding Eurozone economies on 6th July 2012.
Finally, Central Banks in Europe, China and the UK took action towards dealing with the imploding financial crisis. Economic data and failed government efforts made it clear to Central Banks that they will have to act to look for growth and push towards a stable economic climate.
The ECB acted in accordance with the wishes of greater financial institutions as it sought to put a lid on rising debt costs in the Eurozone. Bond prices soared as it became obvious that Eurozone nations (apart from Germany) were focused on austerity measuresand thus were unable to post growth figures, which resulted in markets buying bonds at unfavourable rates. With the cost of borrowing soaring, the ECB were requested to intervene, which they did by cutting interest rates. The Bank of England also acted today, finally extending Quantitative Easing by 50bn. Inflation threats in the UK have subsided and CPI now appears to be on course to reach the 2% target. However, the UK economy has slipped into a recession and is unlikely to recover without assistance. Previous efforts of Quantitative Easing have been successful in the UK and there is every expectation to see a positive outcome from an expansion to this policy. In a surprise move, China cut bench interest rates to continue to push for growth across a dull economic outlook. With the FED having undertaken further rounds of Operation Twist, it appears Central Banks are keen to take the necessary steps to move to a more certain economic climate. Criticism across the city is that action needs to be bolder than the current maintenance policy that is being adopted by Central Banks, something the Forex market would certainly enjoy.
Non-Farm Payrolls in the US tomorrow, should be an interesting afternoon.
About Vantage FX UK
Vantage FX UK is a FX trading broker based in the City of London, providing foreign exchange trading services to clients in the UK, the EU and the rest of the world.
What sets Vantage FX apart is its wide range of services and outstanding level of customer support. The company strives to provide an intuitive, interactive Forex experience by continually innovating and taking advantage of the latest trading technology, such as MetaTrader 4 and Expert Advisors.
Vantage FX also offers extensive educational resources to help give traders their edge, keep up with daily market commentary and try a FX trading demo account.
Finally, Central Banks in Europe, China and the UK took action towards dealing with the imploding financial crisis. Economic data and failed government efforts made it clear to Central Banks that they will have to act to look for growth and push towards a stable economic climate.
The ECB acted in accordance with the wishes of greater financial institutions as it sought to put a lid on rising debt costs in the Eurozone. Bond prices soared as it became obvious that Eurozone nations (apart from Germany) were focused on austerity measuresand thus were unable to post growth figures, which resulted in markets buying bonds at unfavourable rates. With the cost of borrowing soaring, the ECB were requested to intervene, which they did by cutting interest rates. The Bank of England also acted today, finally extending Quantitative Easing by 50bn. Inflation threats in the UK have subsided and CPI now appears to be on course to reach the 2% target. However, the UK economy has slipped into a recession and is unlikely to recover without assistance. Previous efforts of Quantitative Easing have been successful in the UK and there is every expectation to see a positive outcome from an expansion to this policy. In a surprise move, China cut bench interest rates to continue to push for growth across a dull economic outlook. With the FED having undertaken further rounds of Operation Twist, it appears Central Banks are keen to take the necessary steps to move to a more certain economic climate. Criticism across the city is that action needs to be bolder than the current maintenance policy that is being adopted by Central Banks, something the Forex market would certainly enjoy.
Non-Farm Payrolls in the US tomorrow, should be an interesting afternoon.
About Vantage FX UK
Vantage FX UK is a FX trading broker based in the City of London, providing foreign exchange trading services to clients in the UK, the EU and the rest of the world.
What sets Vantage FX apart is its wide range of services and outstanding level of customer support. The company strives to provide an intuitive, interactive Forex experience by continually innovating and taking advantage of the latest trading technology, such as MetaTrader 4 and Expert Advisors.
Vantage FX also offers extensive educational resources to help give traders their edge, keep up with daily market commentary and try a FX trading demo account.
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