EUR/USD: ‘Buy The Rumor, Sell The Fact’ Into Jackson Hole – ING
There is a lot of hype ahead of the Jackson Hole Symposium. Will Draghi hint about QE or talk down the euro? What does Janet Yellen have in store for us? Here is the outlook from ING:
Here is their view, courtesy of eFXnews:
ING FX Strategy Research notes that given the Jackson Hole line-up, with President Draghi not due to speak until late Friday after European trading hours, it seems that some market participants may be slightly wary of being caught short euros in case the ECB chief does spring a surprise policy announcement.
“We now see greater risks of a ‘buy the rumour, sell the fact’ reaction. It is difficult to see President Draghi exceeding the intrinsic QE taper expectations priced into the euro, while he could choose to repeat the Governing Council’s concerns over currency markets front-running ECB policy normalisation.
EUR/$ in this scenario moves lower post-Jackson Hole, or fails to push much higher under a weak $,” ING argues.
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