ECB's Liikanen cautions Euro bulls

Jarratt Davis

Special Consultant to the FPA
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Sentiment update for the New York trading session, 27th March 2018

During today's London session, the market's focus has shifted to EUR which was initially supported by month-end flows.

However, EUR has since pulled off of its best levels following cautious comments from ECB's Liikanen.

Liikanen stated that 'Eurozone inflation is sustainable when ECB's objective can be met without very accommodative monetary policy' and that the 'ECB needs patience as underlying inflation is lower than expected'.

Consequently, EURUSD has since fallen just short of the 1.24 handle and EURJPY just short of the 131.00 handle.

Furthermore, month-end flows are also reportedly benefitting USD which has since strengthened across the board with fresh highs in the USD-index and GBPUSD breaking firmly through the 1.42 handle and approach the 1.41 handle.

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