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Block, Red Dec'22


BLOCK, Put Fly

EURO-DOLLAR: Yesterday's ECB monetary policy meeting concluded with no changes
to the policy settings. EUR/USD tumbled as ECB President Lagarde revealed few
details re: the upcoming policy framework review & seemed to focus on making
future policy action more effective. The rate may have been limited later on by
comments from U.S. Commerce Sec Ross, who suggested that imposing tariffs on
auto imports from the EU is on the table.
- The AFCO committee of the European Parliament has approved the UK Withdrawal
Agreement, setting the stage for the Jan 29 plenary debate and vote.
- The rate trades flat at $1.1053 at typing. Yesterday's sell-off took EUR/USD
through the 100-DMA, which limited losses on Wednesday. Bears look for a fall
through yesterday's 1.5-month low of $1.1036, which would clear the way to the
$1.1000 mark. Coming in at $1.1072, the 100-DMA provides the initial bullish
target, with the 50-DMA intersecting a further 30 pips above.
- The ECB will publish its Survey of Professional Forecasters today, while
policymakers Lagarde, Villeroy and Knot will appear at the WEF. Flash PMI
readings from across the Eurozone will provide some interest.
MNI London Bureau | +44 203-865-3806 |