EUR 8.84 For Business Accounts Only

The Morning Track rising-tides

- The Morning Track – Rising Tides by Bob Savage
http://track.com/articles/the-morning-track-rising-tides/

The key driver for price action overnight – central banks and polticians – as the RBNZ remains on hold as does the Taiwanese and Philippine central banks. The Norges Bank soon joined the group but EUR/NOK is off 0.5% to 9.47 as oil stabilizes and the outlook from the central bank was upbeat. RBNZ saw something of the same reaction with NZD higher as the central bank didn’t mention the recent strength as an issue. Markets also reacted to the Der Speigel interview of ECB Economist Praet – where he sounded worried about Brexit, sympathetic to the German rate wishes but cautious on inflation. The day focus will continue with the Mexico central bank today – and perhaps their last rate cut in the cycle. All of which is about where global easy money policy is in relationship to FX and bonds and inflation. The US and UK started the great curve flattening trade last week and its ongoing today even with oil finding some support. The markets are obsessed with the fear
of policy mistakes and the barometer of such is first in commodities. Oil and other key commodities are supposed to be on the front lines of battling inflation risks. That hasn’t worked out so well since 2009. Expect the rising tide of economic growth to be smashing against the rocks of oil reality today. If the bounce can hold many other trades follow.