Initial claims eyed
The GBP is the strongest and the AUD is the weakest as NA traders enter for the day. The USD is lower as well after being the weakest currency yesterday. The ECB kept policy rates unchanged and reiterated it is willing and able to do more. In addition it made TLTRO conditions more favorable . They announced a new series of nontargeted pandemic emergency longer term refinancing operations or PELTROs as a way to support liquidity conditions in the euro area financial system, and contribute to preserving the smooth functioning of money markets by providing an effective liquidity backstop. They stated that the pandemic emergency purchase program or PEPP will continue to be conducted in a flexible manner over time, cross asset classes and among jurisdictions. Finally, they said net purchases under the asset purchase program (APP) will continue to monthly pace of €20 billion together with purchases under the additional €120 billion temporary envelope until the end of the year. They expect the APP to run for as long as necessary. The EUR is mostly lower with the EURGBP being the weakest.
The ranges and changes are modest with the GBPUSD leading the way at 99 pips and is trading near the highs for the day at the time of the morning snapshot. The EURUSD is trading near unchanged after the ECB decision.
In other markets:
- Spot gold is up $2.80 or 0.17% at $1716.20
- WTI June crude oil is trading higher by $2.34 or 15.47% at $17.40. The July contract is also higher by about $2 or 10.38% at $21.12
In the pre-market for US trading mixed after better earnings from Facebook and Microsoft. The Dow and S&P are now trading lower while the NASDAQ index is still higher but giving back some of the gains:
- Dow is -147 points
- S&P is -11.01 points
- Nasdaq is +69.24 points
In the European market, major indices have turned negative
- German Dax -1.32%
- France's CAC -0.5%
- UKs FTSE -1.3%
- Italy's FTSE MIB -1.2%
In the US debt market, the yields are lower with the 2 – 10 yield curve remained steady at around 42 basis points
In the European debt market, the benchmark 10 year yields are mostly lower with Italian yields the exception. Fitch downgraded Italy at the close of business on Tuesday and that has investors shunning Italian debt.
