The European Central Bank's bond buying program kicks off in 4 days, but the markets are already questioning its effectiveness, while selling off the euro across the board to below key psychological levels.
It is rare that we see a major currency move 20% in a matter of months. However, since May 2014, the euro has done just that against the U.S. dollar. Today, the single European currency hit a new low, trading below the 1.10 figure for the first time since September 2013.
A big milestone no doubt and testament to the changes to which the European Central Bank has committed in the past half a year, bearing in mind that in May 2014 the EUR/USD Exchange rate hit 1.3997.
Forex Magnates reported back in June 2014 about the intentions of the governing council of the European Central Bank (ECB) to do all it could to weaken the euro, but we didn't expect its lengthy undertaking. The lack of sufficient structural reforms in Southern Europe prompted the ECB to act in a timely manner to stem euro strength and relieve local producers from additional pressure.
The Bond Buying Program Conditions
According to an announcement published on ECB's website, the central bank will be buying bonds to the tune of €60 billion in a month from next Monday under preset conditions. This was widely expected, as the old adagio goes, "the devil is in the details".
The monthly figure of bond purchases will include both public and private sector debt. The ECB called its scheme, including government issues, Public Sector Purchase Programme (PSPP). It includes debt securities issued by Euro Area governments, certain agencies and a number of international or supranational institutions.
The design of the program is such that it implies a gradual implementation in order to avoid substantial interference in the price formation of securities markets. The ECB also said that it would be purchasing negative Yield instruments as long as the yield was above the central bank's deposit facility rate.
The announcement sent European debt yields lower across the board with Spain's 10-year trading at 1.28%, Italy's at 1.31%, while Germany's fell to 0.35%.
If the purchasable volume of marketable debt instruments issued by the central government and agencies is insufficient in the respective jurisdiction to accommodate the corresponding share of purchases under the ECB's capital key, substitute purchases are foreseen.
ECB Credited Greece with a Total of €100 Billion Euros
Asked during the Q&A session about the ECB's plans in restoring the eligibility of Greek government bonds as collateral for loans from the central bank, and how the central bank expected to help Greece, Mario Draghi dropped some hot numbers on the table.
He explained that the ECB has already lent €100 billion euros to Greece, totaling 68% of the country's GDP. The president of the central bank further reiterated that this was the highest proportion in any country in the Euro Zone.
The ECB would not be purchasing Greek bonds for the time being, as the country has already hit the 33% issuer limit and the country's paper is rated below investment grade all the while the current review by the Troika is still pending.
Analyst Views
Following the ECB's announcements and press conference a number of analysts voiced their opinion about the effectiveness of the European quantitative easing scheme.
Capital Economics research stated, "We doubt that the Bank's quantitative easing programme will prompt a meaningful economic recovery or eradicate the threat of deflation."
Mr. Draghi left the option of buying more assets from late 2016 on the table and voiced the opinion of the governing council that it didn't intend to deviate from its current bond purchasing plans under any circumstances.
It is rare that we see a major currency move 20% in a matter of months. However, since May 2014, the euro has done just that against the U.S. dollar. Today, the single European currency hit a new low, trading below the 1.10 figure for the first time since September 2013.
A big milestone no doubt and testament to the changes to which the European Central Bank has committed in the past half a year, bearing in mind that in May 2014 the EUR/USD Exchange rate hit 1.3997.
Forex Magnates reported back in June 2014 about the intentions of the governing council of the European Central Bank (ECB) to do all it could to weaken the euro, but we didn't expect its lengthy undertaking. The lack of sufficient structural reforms in Southern Europe prompted the ECB to act in a timely manner to stem euro strength and relieve local producers from additional pressure.
The Bond Buying Program Conditions
According to an announcement published on ECB's website, the central bank will be buying bonds to the tune of €60 billion in a month from next Monday under preset conditions. This was widely expected, as the old adagio goes, "the devil is in the details".
The monthly figure of bond purchases will include both public and private sector debt. The ECB called its scheme, including government issues, Public Sector Purchase Programme (PSPP). It includes debt securities issued by Euro Area governments, certain agencies and a number of international or supranational institutions.
The design of the program is such that it implies a gradual implementation in order to avoid substantial interference in the price formation of securities markets. The ECB also said that it would be purchasing negative Yield instruments as long as the yield was above the central bank's deposit facility rate.
The announcement sent European debt yields lower across the board with Spain's 10-year trading at 1.28%, Italy's at 1.31%, while Germany's fell to 0.35%.
If the purchasable volume of marketable debt instruments issued by the central government and agencies is insufficient in the respective jurisdiction to accommodate the corresponding share of purchases under the ECB's capital key, substitute purchases are foreseen.
ECB Credited Greece with a Total of €100 Billion Euros
Asked during the Q&A session about the ECB's plans in restoring the eligibility of Greek government bonds as collateral for loans from the central bank, and how the central bank expected to help Greece, Mario Draghi dropped some hot numbers on the table.
He explained that the ECB has already lent €100 billion euros to Greece, totaling 68% of the country's GDP. The president of the central bank further reiterated that this was the highest proportion in any country in the Euro Zone.
The ECB would not be purchasing Greek bonds for the time being, as the country has already hit the 33% issuer limit and the country's paper is rated below investment grade all the while the current review by the Troika is still pending.
Analyst Views
Following the ECB's announcements and press conference a number of analysts voiced their opinion about the effectiveness of the European quantitative easing scheme.
Capital Economics research stated, "We doubt that the Bank's quantitative easing programme will prompt a meaningful economic recovery or eradicate the threat of deflation."
Mr. Draghi left the option of buying more assets from late 2016 on the table and voiced the opinion of the governing council that it didn't intend to deviate from its current bond purchasing plans under any circumstances.
Interactive Brokers Expands Offerings with Daily Options on French Stocks
Network, Learn, Grow | FMAS:24
Network, Learn, Grow | FMAS:24
Get ready to mark your calendars for FMAS:24, returning this May! Take a quick glimpse of what awaits at the Sandton Convention Centre in Sandton, South Africa from May 20-22, 2024.
Don't miss out on this 5-second invite packed with energy and urgency!
Secure your free ticket now 🔗 https://events.financemagnates.com/yQx0l?utm_source=youtube&utm_campaign=fmas-is-back&utm_medium=video&RefId=FMAS24+Video+Ad+%5B1%5D
#fmas24 #fmas #fmevents #financeinafrica #traders #investors #affiliates #forexTraders #investmentOpportunities #B2BNetworking #finTech #Innovations #TradingCommunity #BusinessOpportunities #AfricanBusiness #Johannesburg #southafrica
📣 Stay updated with the latest in finance and trading!
Follow FMevents across our social media platforms for news, insights, and event updates. Connect with us today:
🔗 LinkedIn: https://www.linkedin.com/showcase/financemagnates-events/
👍 Facebook: https://www.facebook.com/FinanceMagnatesEvents
📸 Instagram: https://www.instagram.com/fmevents_official
🐦 Twitter: https://twitter.com/F_M_events
🎥 TikTok: https://www.tiktok.com/@fmevents_official
▶️ YouTube: https://www.youtube.com/@FinanceMagnates_official
Don't miss out on our latest videos, interviews, and event coverage. Subscribe to our YouTube channel for more!
Get ready to mark your calendars for FMAS:24, returning this May! Take a quick glimpse of what awaits at the Sandton Convention Centre in Sandton, South Africa from May 20-22, 2024.
Don't miss out on this 5-second invite packed with energy and urgency!
Secure your free ticket now 🔗 https://events.financemagnates.com/yQx0l?utm_source=youtube&utm_campaign=fmas-is-back&utm_medium=video&RefId=FMAS24+Video+Ad+%5B1%5D
#fmas24 #fmas #fmevents #financeinafrica #traders #investors #affiliates #forexTraders #investmentOpportunities #B2BNetworking #finTech #Innovations #TradingCommunity #BusinessOpportunities #AfricanBusiness #Johannesburg #southafrica
📣 Stay updated with the latest in finance and trading!
Follow FMevents across our social media platforms for news, insights, and event updates. Connect with us today:
🔗 LinkedIn: https://www.linkedin.com/showcase/financemagnates-events/
👍 Facebook: https://www.facebook.com/FinanceMagnatesEvents
📸 Instagram: https://www.instagram.com/fmevents_official
🐦 Twitter: https://twitter.com/F_M_events
🎥 TikTok: https://www.tiktok.com/@fmevents_official
▶️ YouTube: https://www.youtube.com/@FinanceMagnates_official
Don't miss out on our latest videos, interviews, and event coverage. Subscribe to our YouTube channel for more!
Here's a sneak peek into the FMAS:24 vibrant atmosphere! Join us at Africa’s premium financial event for a transformative experience that combines the best of finance and technology.
From May 20-22, 2024, the Sandton Convention Centre in Sandton, South Africa, will be the hub for over 3,500 attendees to engage in unparalleled networking opportunities, learn from over 150 industry-leading speakers, and explore innovations from 120+ exhibitors.
Secure your free ticket now 🔗 https://events.financemagnates.com/yQx0l?utm_source=youtube&utm_campaign=fmas-is-back&utm_medium=video&RefId=FMAS24+Video+Ad+%5B1%5D
#fmas24 #fmas #fmevents #financeinafrica #traders #investors #affiliates #forexTraders #investmentOpportunities #B2BNetworking #finTech #Innovations #TradingCommunity #BusinessOpportunities #AfricanBusiness #Johannesburg #southafrica
📣 Stay updated with the latest in finance and trading!
Follow FMevents across our social media platforms for news, insights, and event updates. Connect with us today:
🔗 LinkedIn: https://www.linkedin.com/showcase/financemagnates-events/
👍 Facebook: https://www.facebook.com/FinanceMagnatesEvents
📸 Instagram: https://www.instagram.com/fmevents_official
🐦 Twitter: https://twitter.com/F_M_events
🎥 TikTok: https://www.tiktok.com/@fmevents_official
▶️ YouTube: https://www.youtube.com/@FinanceMagnates_official
Don't miss out on our latest videos, interviews, and event coverage. Subscribe to our YouTube channel for more!
Here's a sneak peek into the FMAS:24 vibrant atmosphere! Join us at Africa’s premium financial event for a transformative experience that combines the best of finance and technology.
From May 20-22, 2024, the Sandton Convention Centre in Sandton, South Africa, will be the hub for over 3,500 attendees to engage in unparalleled networking opportunities, learn from over 150 industry-leading speakers, and explore innovations from 120+ exhibitors.
Secure your free ticket now 🔗 https://events.financemagnates.com/yQx0l?utm_source=youtube&utm_campaign=fmas-is-back&utm_medium=video&RefId=FMAS24+Video+Ad+%5B1%5D
#fmas24 #fmas #fmevents #financeinafrica #traders #investors #affiliates #forexTraders #investmentOpportunities #B2BNetworking #finTech #Innovations #TradingCommunity #BusinessOpportunities #AfricanBusiness #Johannesburg #southafrica
📣 Stay updated with the latest in finance and trading!
Follow FMevents across our social media platforms for news, insights, and event updates. Connect with us today:
🔗 LinkedIn: https://www.linkedin.com/showcase/financemagnates-events/
👍 Facebook: https://www.facebook.com/FinanceMagnatesEvents
📸 Instagram: https://www.instagram.com/fmevents_official
🐦 Twitter: https://twitter.com/F_M_events
🎥 TikTok: https://www.tiktok.com/@fmevents_official
▶️ YouTube: https://www.youtube.com/@FinanceMagnates_official
Don't miss out on our latest videos, interviews, and event coverage. Subscribe to our YouTube channel for more!
Join 3500+ Attendees at FMAS:24 | Africa's Premium Financial Event
Join 3500+ Attendees at FMAS:24 | Africa's Premium Financial Event
Looking to expand your network in #Africa? Join 3500+ attendees at FMAS:24, where online trading, fintech, payments, and crypto meet! Connect with industry leaders and innovators for an unmatched networking experience.
20-22 MAY 2024
Sandton Convention Center, Sandton, South Africa
Register now to secure your spot: https://bit.ly/3JbUpCK
#fmas #fmas24 #fmevents #networking #finance #africa
📣 Stay updated with the latest in finance and trading!
Follow Finance Magnates for news, insights, and event updates across our social media platforms. Connect with us today:
🔗 LinkedIn: https://www.linkedin.com/company/financemagnates/
👍 Facebook: https://www.facebook.com/financemagnates/
📸 Instagram: https://www.instagram.com/financemagnates_official
🐦 X (Twitter): https://twitter.com/financemagnates/
📡 RSS Feed: https://www.financemagnates.com/feed/
▶️ Telegram: https://t.me/financemagnatesnews
Don't miss out on our latest videos, interviews, and event coverage.
🔔 Subscribe to our YouTube channel for more!🔔
Looking to expand your network in #Africa? Join 3500+ attendees at FMAS:24, where online trading, fintech, payments, and crypto meet! Connect with industry leaders and innovators for an unmatched networking experience.
20-22 MAY 2024
Sandton Convention Center, Sandton, South Africa
Register now to secure your spot: https://bit.ly/3JbUpCK
#fmas #fmas24 #fmevents #networking #finance #africa
📣 Stay updated with the latest in finance and trading!
Follow Finance Magnates for news, insights, and event updates across our social media platforms. Connect with us today:
🔗 LinkedIn: https://www.linkedin.com/company/financemagnates/
👍 Facebook: https://www.facebook.com/financemagnates/
📸 Instagram: https://www.instagram.com/financemagnates_official
🐦 X (Twitter): https://twitter.com/financemagnates/
📡 RSS Feed: https://www.financemagnates.com/feed/
▶️ Telegram: https://t.me/financemagnatesnews
Don't miss out on our latest videos, interviews, and event coverage.
🔔 Subscribe to our YouTube channel for more!🔔
Join 3500+ Attendees at FMAS:24 - Africa's Premium Financial Event
Join 3500+ Attendees at FMAS:24 - Africa's Premium Financial Event
Looking to expand your network in #Africa?
Join 3500+ attendees at FMAS:24, where online trading, fintech, payments, and crypto meet! Connect with industry leaders and innovators for an unmatched networking experience.
20-22 MAY 2024
Sandton Convention Center, Sandton, South Africa
Register now to secure your spot: https://bit.ly/3JbUpCK
#fmas #fmas24 #fmevents #networking #finance #africa
Looking to expand your network in #Africa?
Join 3500+ attendees at FMAS:24, where online trading, fintech, payments, and crypto meet! Connect with industry leaders and innovators for an unmatched networking experience.
20-22 MAY 2024
Sandton Convention Center, Sandton, South Africa
Register now to secure your spot: https://bit.ly/3JbUpCK
#fmas #fmas24 #fmevents #networking #finance #africa
Where the Prop Trading Industry Goes from Here | Finance Magnates Podcast
Where the Prop Trading Industry Goes from Here | Finance Magnates Podcast
Explore the tumultuous world of prop trading in this Finance Magnates podcast episode, featuring insights from Head of Axi Select, Greg Rubin.
We're discussing the challenges and shifts caused by MetaQuotes' pivotal decisions affecting MT4 and MT5 users, and how Axi Select offers a unique, realistic path to professional trading, steering clear of traditional prop firm pitfalls.
Tune in for expert analysis on the future of trading and innovative funding models.
The Axi Select programme is only available to clients of AxiTrader Limited. CFDs carry a high risk of investment loss. In our dealings with you, we will act as a principal counterparty to all of your positions. This content is not available for AU, NZ, EU and UK residents. For more information, refer to our Terms of Service. Standard trading fees apply.
This content is provided solely for general informational purposes and should not be construed as financial product advice or an investment recommendation. It has been prepared without considering your personal circumstances.
📣 Stay updated with the latest in finance and trading!
Follow Finance Magnates for news, insights, and event updates across our social media platforms. Connect with us today:
🔗 LinkedIn: https://www.linkedin.com/company/financemagnates/
👍 Facebook: https://www.facebook.com/financemagnates/
📸 Instagram: https://www.instagram.com/financemagnates_official
🐦 X (Twitter): https://twitter.com/financemagnates/
📡 RSS Feed: https://www.financemagnates.com/feed/
▶️ Telegram: https://t.me/financemagnatesnews
Don't miss out on our latest videos, interviews, and event coverage.
🔔 Subscribe to our YouTube channel for more!🔔
Explore the tumultuous world of prop trading in this Finance Magnates podcast episode, featuring insights from Head of Axi Select, Greg Rubin.
We're discussing the challenges and shifts caused by MetaQuotes' pivotal decisions affecting MT4 and MT5 users, and how Axi Select offers a unique, realistic path to professional trading, steering clear of traditional prop firm pitfalls.
Tune in for expert analysis on the future of trading and innovative funding models.
The Axi Select programme is only available to clients of AxiTrader Limited. CFDs carry a high risk of investment loss. In our dealings with you, we will act as a principal counterparty to all of your positions. This content is not available for AU, NZ, EU and UK residents. For more information, refer to our Terms of Service. Standard trading fees apply.
This content is provided solely for general informational purposes and should not be construed as financial product advice or an investment recommendation. It has been prepared without considering your personal circumstances.
📣 Stay updated with the latest in finance and trading!
Follow Finance Magnates for news, insights, and event updates across our social media platforms. Connect with us today:
🔗 LinkedIn: https://www.linkedin.com/company/financemagnates/
👍 Facebook: https://www.facebook.com/financemagnates/
📸 Instagram: https://www.instagram.com/financemagnates_official
🐦 X (Twitter): https://twitter.com/financemagnates/
📡 RSS Feed: https://www.financemagnates.com/feed/
▶️ Telegram: https://t.me/financemagnatesnews
Don't miss out on our latest videos, interviews, and event coverage.
🔔 Subscribe to our YouTube channel for more!🔔