Sunday, July 23, 2017

XEU Euro Daily Chart; ECB Stealth-Tapered in April and No One Noticed

The euro has trended upwards since April from 1.06. The ECB lowered the monthly asset purchase QE program from 80 billion euros per month to 60 billion euros ($70 billion) in April (blue circle). President Draghi announced this move last December to prepare the markets and he was adamant that the reduction in QE did not constitute a taper. Draghi said that 60 to 80 billion euros was always a range so the monthly purchases simply moved to the bottom of the range and it is not a taper.

The euro trending higher from April and the European stock indexes flat to lower since April verify that the the reduction in QE purchases that began in April is perceived as a tapering of the ECB's quantitative easing program whether Draghi calls it that or not.

Everyone went wild when Draghi hinted last Thursday, 7/20/17, that the tapering of the QE program would begin to be discussed in the autumn. This creates that move from 1.14 to 1.16 and higher but the euro had already moved from 1.06 to 1.14 due to the QE purchases tapering from 80 billion euros to 60 billion euros per month in April. This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here. Consult your financial advisor before making any investment decision.

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