Daily Alert – Tuesday 24th January 2023: ECB being very hawkish, AGAIN
Yesterday’s risk-on sentiment didn’t last. Today is much more indecisive.
The Euro zone posted a positive Composite PMI for December, showing an expanding economy, which will make the European Bank policymakers more confident that the economy can withstand their hawkishness. Talking of hawkishness, ECB President Lagarde re-iterated, again, their hawkish stance. If you look back over the economic calendar powerpoints that I update every day, you will see this is now a concerted effort by the bank to get that message across. The EUR soars, as you might expect.
Back in poor old Blighty, our Services PMI missed expectation and is showing a contraction in the economy.
I looked closely at equities, AUDJPY long and EURUSD long, as I mentioned in yesterday’s video. I did not take any of them. Equities are not yet reversing and neither currency presented with attractive setups, so better safe than sorry.
I’ll have another look later tonight, but I’d be surprised if it is very much different to the current situation.
I’ll be back tomorrow.
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