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14 Jan 2015
Central Banks meeting internally around oil price plunges - Investec
FXStreet (Guatemala) - Jonathan Pryor, Corporate Treasury Analyst at Investec explained the perception of Central Bankers continues to be the defining factor in how currency markets are reacting to the recent plunge in oil prices and the subsequent drag on short term inflation.
Key Quotes:
"In Europe, last week’s sub 0% inflation print may well seal the announcement of QE in the Eurozone as early as next week (recall the 22 January is the day of the next ECB meeting where they will no doubt deliberate over medium term inflation concerns)."
"In Japan, the BOJ announced yesterday they may review their inflation targets as the oil price fall affects the oil importer's inflation goals - this caused USDJPY to move below 117 overnight. A similar story can be seen in other low-flation countries such as Sweden, who may also adopt QE."
Key Quotes:
"In Europe, last week’s sub 0% inflation print may well seal the announcement of QE in the Eurozone as early as next week (recall the 22 January is the day of the next ECB meeting where they will no doubt deliberate over medium term inflation concerns)."
"In Japan, the BOJ announced yesterday they may review their inflation targets as the oil price fall affects the oil importer's inflation goals - this caused USDJPY to move below 117 overnight. A similar story can be seen in other low-flation countries such as Sweden, who may also adopt QE."