Yesterday ECB President Draghi signalled that a decision about the fate of ECB monetary policy will be made in October. With Draghi mentioning last month’s meeting, market participants considered this as an admission that a substantive conversation about a shift in policy was held.
Draghi also addressed ICO’s, indicating that his institution does not have the authority to regulate cryptocurrencies. Upcoming speeches will provide insight into whether the ECB intends to issue a regulatory framework or an all-out ban on cryptocurrencies, and whether Draghi felt that higher capital requirements for fintech were required to protect the banking sector.
The pledge by President Putin and OPEC to cut oil output to lift prices may be extended to the end of 2018, instead of expiring in March 2018. Record US exports and the return of supply from a Libyan oilfield weighed on the market. US crude oil inventories decreased by 6 million barrels from the previous week. Inventories have dropped in the past two weeks as Gulf Coast refineries restart after weeks of shutdowns due to Hurricane Harvey. WTI trades near 50 USD per barrel while Brent is just below 56 USD.
EUR/USD rose above 1.1770 at the start of European trade. The greenback held its ground against its major rivals, but slipping Treasury yields kept gains versus the euro in check.
USD/JPY traded in a tight range and stands at 112.665 after touching 112.92 earlier in the session.
