Markets fluctuate ahead of ECB

Stock markets have endured another negative day in Europe as investors await tomorrow’s hotly-anticipated ECB meeting.

Much like the other two days this week, it’s hard to read too much into today’s trading as there’s very little of note driving it. And with the ECB tomorrow, US inflation on Friday and the Fed next week, there are far more pressing matters ahead than the selection of headlines of recent days.

The World Bank warning of potential recessions, a UK Prime Minster barely surviving a confidence vote and a major US retailer lowering profit guidance as a result of excess inventory have been among the focal points this week but they all comfortably play second fiddle to what’s to come over the next seven days.

The ECB is up first tomorrow and the central bank has a lot of questions to answer. When will net asset purchases officially end? How many rate hikes can we expect this year? How will they manage the fallout in the bond markets? The task is far from straightforward but the cost of inaction is potentially severe. The central bank will have to tread carefully in the coming months to prevent unwanted consequences.

Bitcoin volatile but not going anywhere

We’re continuing to see plenty of volatility in bitcoin but very little actual direction. The daily ranges are wider but the end result is the same. This could be another that is awaiting the inflation data before deciding where to head next. The set-up is still bearish at this point but as ever, it may not take much to tilt that the other way and a significant break of USD 32,000 could deliver just that. ​

For a look at all of today’s economic events, check out our economic calendar:

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Craig Erlam

Craig Erlam

Senior Market Analyst, UK & EMEA at OANDA
Based in London, Craig Erlam joined OANDA in 2015 as a market analyst. With many years of experience as a financial market analyst and trader, he focuses on both fundamental and technical analysis while producing macroeconomic commentary. His views have been published in the Financial Times, Reuters, The Telegraph and the International Business Times, and he also appears as a regular guest commentator on the BBC, Bloomberg TV, FOX Business and SKY News. Craig holds a full membership to the Society of Technical Analysts and is recognised as a Certified Financial Technician by the International Federation of Technical Analysts.
Craig Erlam