Daily Market Report – 16/04/2015 EUR The Euro fell broadly on Wednesday after the European Central Bank kept borrowing rates unchanged as expected and kept a dovish policy bias despite a recent pick-up in economic activity. At Wednesday’s meeting, the ECB left its main refinancing rate, which determines the cost of credit in the economy, at 0.05 percent. It also kept the rate on bank overnight deposits at -0.20 percent, which means banks pay to park funds with it. ECB President Mario EUR The Euro fell broadly on Wednesday after the European Central Bank kept borrowing rates unchanged as expected and kept a dovish policy bias despite a recent pick-up in economic activity. At Wednesday’s meeting, the ECB left its main refinancing rate, which determines the cost of credit in the economy, at 0.05 percent. It also kept the rate on bank overnight deposits at -0.20 percent, which means banks pay to park funds with it. ECB President Mario Draghi said the bank intends to fully deliver the previously announced stimulus measures as risks to growth remain and inflation is subdued. This comes on the back of reports that quantitative easing has begun to create a bubble pushing up bond prices. Draghi said that despite interest on many government bonds turning negative, there has not been signs of increased borrowing which is a sign of a bubble. Also some information released on Greece yesterday showed the true extent of the poor performance of the economy in the last 4 years. The figures confirm that Greece’s GDP shrank from €207bn in 2011 to €170bn in 2014. That means its national debt swelled from 171% of GDP to 177% GDP last year, despite the billions of Greek debt being written down in 2012 and heavy spending cuts. Ratings agency Standard and Poor’s yesterday downgraded debt further into junk territory giving it a CCC+/C rating. They state without deep economic reform and further relief, Greece’s debt and other financial commitments will be unsustainable. German finance minister Wolfgang Schauble vented his anger yesterday at the slow progress being made on Greece. There is a Eurogroup meeting at the end of this week but he doesn’t expect there to be any resolution. Key Announcements13:30 – USD – Continuing Jobless Claims expected to rise to 2.312M from 2.304M13:30 – USD – Initial Jobless Claims expected to fall to 280k from 281k Our dealers are available via e-mail ([email protected]) or by phone (020 7220 8181).