EUR/USD Jumps on ECB & Letta

EUR/USD jumped today after the European Central Bank refrained from additional stimulus at today’s policy meeting and suggested at the press-conference that the current accommodative policy will stay for a long time. (Event B on the chart.) The euro was also stronger after Italian Prime Minister Enrico Letta won the confidence vote in the parliament, avoiding the need for another election. It is interesting to note that former Prime Minister Silvio Berlusconi supported Letta even though it was Berlusconi who has started the political crisis in the first place. The employment data from the United States was disappointing. It is even more important than usual because the government report (nonfarm payrolls) will likely not be released this week due to the government shutdown.
ADP employment grew by 166k jobs in September, missing the analysts’ estimate of 177k. The August growth was revised negatively from 176k to 159k. (Event A on the chart.)
Crude oil inventories increased by 5.5 million barrels last week and are toward the upper range for this time of year. Analysts have expected the stockpiles to expand at the previous week’s rate of 2.6 million. Total motor gasoline inventories increased by 3.5 million barrels and are at the top of the average range. (Event C on the chart.)


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