The Australian dollar rose 0.4 percent to $0.7238, recovering from its two-week low of $0.7182 hit on Thursday.
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There was little sign of the moves to come before Draghi’s speech, when the euro was down just 0.2 percent against its US counterpart and barely reacted to the central bank holding its main interest rate at 0.05 percent and its deposit rate at minus 0.2 percent, as predicted by economists.
Mr. Draghi’s language and explicit reference to December was more direct than many had expected, sending stocks and eurozone bonds higher as the euro sank against the dollar. But Friday brought early gains for US, Asian and European markets. Gold was slightly lower at $1 165.36 an ounce after touching a nine-day low overnight, and was down nearly 1 percent for the week.
After the ECB held policy steady at its meeting on Thursday as widely expected, central bank chief Mario Draghi told a news conference that ECB policymakers were “open to the full menu of monetary policy” to stoke the euro zone economy as needed. While new business grew at the fastest rate in six months, encouraging firms to boost hiring, the rate of job creation “remains insufficient” to significantly reduce unemployment, it said.
“Draghi’s comments are supportive”, van Cleef said.
In Tokyo, the Nikkei 225 index advanced 433.97 points to 18,869.84 by the lunch break, while the broader Topix index of all first-section shares gained 2.10 percent, or 31.81 points, to 1,550.03.
Hong Kong’s Hang Seng Index gained 1.3% and the Shanghai Composite Index closed up 1.3%, after data showed improvement in China’s house prices and sales. Woolworths (WOW. Australia) jumped 3.9% after local media reported private equity funds KKR and TPG Capital approached the company to buy its discount retailer Big W for around 1.5 billion Australian dollars. Us crude added 0.5 percent to $45.60 but was down 3.5 percent for the week. Still, a few analysts believe it is too early to say if the euro will sustainably break out of its rough $1.11-15 trading range in the past couple of months, and head to below $1.10.
The quarterly Survey of Professional Forecasters now sees inflation in the currency bloc at only 0.1 per cent this year, a cut of 0.1 percentage point versus the previous forecast round in July.
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“The ECB’s signal surprised a lot of people, that as long as we don’t get a major improvement over the next couple of months they will probably expand their QE programme – more money printing, the whole caboodle”.
