ECB Interest Rate Decision

• ECB is to announce its interest rate decision today at 11.45 (GMT) and is widely expected (97.28% by EUR OIS) to remain on hold at 0.00%.
• Market focus could shift to the accompanying statement which may have a more hawkish tone, as the inflation rate has accelerated.
• It could also be the case that the bank could announce or imply that it will gradually end or taper, its massive QE program.
• Should that be the case we could see the common currency strengthening as such a scenario may not have been totally priced in by the market.

BoJ Interest Rate Decision

• BoJ is to announce its interest rate decision tomorrow during the Asian session and is widely expected to remain on hold at -0.10%.
• Currently, JPY OIS imply a probability for the bank to remain on hold, of 95.75%.
• Should the bank remain on hold we could see the market turning its attention to the accompanying statement, which could have a neutral to dovish tone due to the recent lukewarm financial data.
• Should that be the case we could see the JPY weakening against its major counterparts.

FOMC hikes by 25 basis points

• The FOMC hiked its interest rate by 0.25% reaching +2.00%, as was expected.
• Also the dot plot changed implying 2 more hikes could be expected (probably September and December) in 2018.
• Overall there was a rather hawkish tone in the accompanying statement and most of the Fed’s anxieties were shrugged off.
• The USD strengthened upon the decision and we could see it getting some support in the near future, guided by the decision.

Today’s other economic highlights

• Germany: Final HICP for May, Survey: +2.2% yoy Prior: +2.2% yoy, 06:00 (GMT), could strengthen EUR
• France: Final CPI (EU Norm.) for May, Survey: +2.3% yoy Prior: +2.3% yoy, 06:45 (GMT), could support EUR
• UK: Retail Sales for May, Survey: +0.5% mom Prior: +1.6% mom, 08:30 (GMT), could weaken GBP
• US: Core Retail Sales for May, Survey: +0.5% mom Prior: +0.3% mom, 12:30 (GMT), could strengthen USD
• US: Retail Sales for May, Survey: +0.4% mom Prior: +0.2% mom, 12:30 (GMT), could strengthen USD

IronFX Daily Report ‘June 14th’