Draghi leaves a mark as ECB talks up policy...>

FOREX: Draghi leaves a mark as ECB talks up policy headroom

-The ECB policy forum in Sintra kicked off with a bang, as Draghi talked up the

policy tools still available to the central bank should the outlook worsen

further. The ECB governor highlighted that further rate cuts and QE are part of

the toolkit and that additional stimulus will be needed should the outlook fail

to improve. Markets were happy to sell the EUR in response, sending EURUSD

through this week and last week's lows against the USD as German bond yields

sank to fresh record lows. EUR bears now eye next support at $1.1164/1.1155.

-AUD sits just behind the EUR as one of the poorest performing currencies in G10

FX today as the RBA weighed in on the likelihood of further rate cuts in the

minutes of their June meeting. The RBA seemed agree that further easing "would

be appropriate in the period ahead". AUD/USD now on track to clock the lowest

close since early 2009.

-Attention turns to US housing starts/building permits data and the Sintra

policy forum continues. ECB's Draghi and BoE governor Carney are both due to

speak.