15 Jul 2014
Central Banks are volatile - BAML
FXStreet (Guatemala) - Athanasios Vamvakidis, FX Strategist at Bank of America Merrill Lynch explained that G10 central banks have been suppressing volatility.
Key Quotes
The Fed has broadly ignored improving data and increasing inflation and has maintained a dovish tone."
"The ECB has given up the QE option this year, as further easing will have to wait for the implementation of the TLTROs. Most other central banks respond with stronger forward guidance to any market pricing of early rate hikes and verbal interventions to any currency strength."
"In a world in which the Fed prefers to tighten too late than to tighten too early, the ECB has finally started easing policies, the BoJ has launched its largest QE ever and global inflation remains under control, no other central bank has an incentive to tighten. The hawkish RBNZ is the exception that proves the rule, with the NZD the best performing G10 currency so far this year, from already high levels."
Key Quotes
The Fed has broadly ignored improving data and increasing inflation and has maintained a dovish tone."
"The ECB has given up the QE option this year, as further easing will have to wait for the implementation of the TLTROs. Most other central banks respond with stronger forward guidance to any market pricing of early rate hikes and verbal interventions to any currency strength."
"In a world in which the Fed prefers to tighten too late than to tighten too early, the ECB has finally started easing policies, the BoJ has launched its largest QE ever and global inflation remains under control, no other central bank has an incentive to tighten. The hawkish RBNZ is the exception that proves the rule, with the NZD the best performing G10 currency so far this year, from already high levels."