ECB and BOE Keep Policy Unchanged - 8.2.2013

The European Central Bank decided to maintain unchanged its monetary policy, holding key interest rate at 0.75%. The ECB President Mario Draghi held a dovish tone at its speech yesterday as it was expected. He specifically said “ The risks surrounding the economic outlook for the euro area continue to be on the downside” and “… upside risks relating to … the appreciation of the euro exchange rate.” The EURUSD dived from 1.3575 to 1.3369 on Wednesday’s trading, providing ahead of the ECB meeting a fake upside signal and then significantly declining, it has remained between 1.3414/1.3369 tight range since then. The Bank of England, as it was projected, voted to hold unchanged the official Bank Rate at 0.5% and its asset purchases maintained at £375B. The Brtish pound initially jumped 1.5766, against the US dollar, on newly elected BOE Governor Mark Garney reports that should gradually exit the unconventional policy, however then with monetary decision release the pair eased back around 1.5740. Lastly, the USDJPY was under pressure on risk-off as the US stock indices closed negative and Jobless claims were worse than estimated, the pair dropped from 93.72 to 92.15 early on Friday morning.