Draghi making lifea little tougher for Yellen – ANZ

By FXStreet FXStreet (Guatemala) – David Croy, Senior Rates Strategist, Dylan Eades, Economist at ANZ noted that Draghi announced that the ECB was raising the issue share limit on a single country’s debt stock to 33% from 25%.

Key Quotes:

“This drove a sharp rally in core and peripheral euro area sovereign bonds, with Bund yields down 6bps. EUR declined sharply on the prospect of further policy action by the ECB, but the NZD outperformed, pushing back above USD0.64.”

“Upon receiving news of the ECB’s renewed dovish resolve and its decision to lift issue limits, Fed Chair Janet Yellen was probably thinking to herself: why’d you have to do that this month, Mario? In all likelihood it was to be expected, but with everyone else easing or delaying hikes, at the margin it just makes lift-off that little bit harder for the Fed to deliver. US market pricing hasn’t changed much, but newswires are abuzz with talk that the ECB’s actions may delay the Fed.”

“Time will tell, but we are certainly mindful that the Fed’s USD TWI continues to grind higher (it’s 25% up on its 2011 low and at a 12-year high), slowly tightening the thumbscrews on US competitiveness. A strong currency may …read more

Source:: FX Street