Draghi’s press conference is wrapping up, and the upshot is a weaker economy going forward — but, one strong enough to get along without QE. 2018 GDP was lowered from 2.4 to 2.1%, with 2019 and 2020 remaining unchanged at 1.9% and 1.7%. 2018 inflation estimates were increased from 1.4% to 1.7%, where Draghi expects it to remain for the next several years.
Not surprisingly, the euro is taking it on the chin.DXY, whose latest channel had broken down yesterday, was suddenly back in the black.Equity futures are loving the dollar resurgence which, combined with the threat of (what else is new?) another VIX breakdown, has ES pushing 18 points off its overnight lows. For now, at least, the focus is off China’s economy, which is clearly weakening just in time for the imposition of US tariffs.
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