Comment on the situation on a market 04.03.14

It makes sense to sell EUR on the up-trend

It looks like EUR will remain under pressure despite the fact that Mario Draghi is expected not to continue further monetary policy mitigation. We believe that on the next meeting which will take place this Thursday ECB president can announce his decision. We still remember how he unexpectedly decreased refinance rate from 0,50% to 0,25% last November. The problem is that EuroZone is still in the stagnation period and that insignificant GDP growth in several countries including Germany, France and Spain is just a rebound from a massive drop in the previous years. High unemployment rate, weak PMI, low inflation and many other economic problems might make ECB to go for new monetary policy incentives reduction.

French government already announced that they are concerned about high EUR rate and head of IMF Lagarde said that long period of low inflation is capable to have a massive impact on Euro Zone economy.

That is why we believe that EUR can be under pressure in a short-term.

Semen Kamensky​