ECB MEETING MINUTES DRIVE THE HEADLINES ON THURSDAY
A combination of economic data and monetary policy will dominate the headlines on Thursday. The European Central Bank (ECB) tops the list when it releases the minutes of its most recent policy meeting.
French inflation data will kick off the economic calendar on Thursday. The report, which is scheduled for 06:45 GMT, is expected to show a strong pickup in consumer price growth in March. The headline reading will likely show 1.1% growth compared with February. However, the annual rate will likely hold at 1.7%.
The European Commission’s statistical agency will release the latest factory data at 09:00 GMT. Industrial production across the 19-member Eurozone is forecast to rise 0.1% in February after a 1% drop the previous month. In annualized terms, this translates into a gain of 3.8%.
The ECB will release its monetary policy meeting accounts at 11:30 GMT, giving investors more insight into the most recent interest rate decision. Officials have remained on the sidelines in recent months as the euro area recovery engine continues to pick up steam. The central bank has already shifted course on its policy trajectory by announcing cuts to its record stimulus program. In doing so, it joins the US Federal Reserve and Bank of Canada in beginning to normalize monetary policy.
ECB Executive Board member Benoit Coeure will deliver a speech at 12:15 that will be closely monitored by currency traders.
Shifting gears to North America, the Labor Department will report on initial jobless claims at 12:30 GMT. North of the border, the Canadian government will also release its latest housing price index for new properties.
Bank of England (BOE) Governor Mark Carney is scheduled to deliver a speech late on Thursday. A few hours later, Federal Open Market Committee (FOMC) member Neel Kashkari will do the same.
Europe’s common currency drifted lower on Wednesday after a hawkish reading of the FOMC meeting minutes emboldened the dollar. EUR/USD was last seen trading at 1.2372, having rebounded from a daily bottom of 1.2352. The pair faces immediate support at 1.2340. Resistance is located just above 1.2400.
The British pound weakened in mid-week trade as investors took in the FOMC minutes. Cable bottomed out near 1.4160 before recovering around 1.4190. However, upside remains in tact, with the bulls eyeing a return to the 1.4245-1.4275 region. On the opposite side of the spectrum, immediate support is located at 1.4155.
FOMC minutes couldn’t save the USD/CAD from another down session. The pair fell to fresh six-week lows on Wednesday, as the Canadian dollar extended its ongoing recovery. The pair is currently trading at 1.2566, having declined 0.1% from the previous close and a whopping 550 pips since 19 March.