As highlighted earlier in the week, we thought that the PBOC would act and reduce the Reserve Requirement Ratio possibly at the weekend ahead of CPI data due on Monday. The PBOC have indeed acted with a rate cut in the past few minutes. At the same time the BOE have increased their bond purchase program by 50bn GBP, both of these events had been heavily anticipated by the market.

European equity markets have added around 50bps on the news along with an initial spike in the Euro and Gold futures.


Posted by Philip Ball | Sales and Trading