Same Game But EURO Goals Have Shifted

Forex moves have been rather uninspiring, unless you are Cable of course, as investors wait to see if they are served up any clues on how many Fed members are in favor of ending QE early. The prospect of a QE exit is likely to limit further dollar losses. So far this morning, investors are clinging to yesterday's strong improvements in the German ZEW and likely strength in the upcoming IFO and PMI's to justify holding the single currency at the moment. Perhaps one of the stronger arguments supporting the 17-member currency would be the reallocation of funds by Japanese investors. Just like any global investor, Japanese citizens too are trying to maximize their returns.

Outgoing Governor of the BoE Mervyn King, along with two fellow members, were defeated in a push for extra stimulus at this months MPC meeting according to their minutes published this morning. All three voted to increase the QE package by +GBP25m to +GBP400m, stating that further AP would help the UK economy...