EUR 8.70 For Business Accounts Only

The Morning Track cool-talks

- The Morning Track – Cool Talks by Bob Savage
http://trackresearch.com/articles/the-morning-track-cool-talks/

The focus today seems to be on what is said and what isn’t said – with the ECB speeches today the most likely to move markets but there was a clash of headlines to start the day all of which seemed to matter but didn’t suggesting the reign of low yields and lower volatility holds for now. Between the German Coalition talks breaking down, Zimbabwe’s Mugabe not saying he would step down, the Greek central banker being accused of talking too much (leaking an auditors report on Piraeus Bank), European Council President Tusk tweeting about how the Polish Law and Justice Party policies look like a “Kremlin plan” and the UK considering paying up to have talks over Brexit – simple communication looks expensive, confusing and dangerous. For the EUR, the failure for Merkel to work it out with the Greens or the FDP leaving a hard choice between a minority government or new elections, that just doesn’t matter, as early losses in Asia reversed in Europe. There were oth
er stories that drive some action – the IMF suggesting the RBA rate hike cycle was another year away – that hurt the AUD – and the Pinera win in the first round of Chile Presidential elections with 36.7% against Guillier at 22.7% - leaving the LATAM swing to right ongoing and copper bid. The markets seem more flat than excited today with lighter economic data – Japan trade to China looks more important than to the US while German PPI was in line and all about energy still. The focus is on anything that moves and that leaves the key FX with EUR 1.1720-1.1880 the breakout zones to watch for something more dramatic.