FOREX: EU Debating Pooling Of US Dollars To Lessen Fed Reliance - Reuters
Reuters has reported that “European financial stability officials are debating whether to create an alternative to Federal Reserve funding backstops by pooling dollars held by non-U.S. central banks in a bid to reduce their reliance on the U.S. under the Trump administration, five officials familiar with the matter said.”
- The report (link) is based on interviews with more than a dozen European central banking and supervisory officials.
- Two said concerns peaked around April but that worried have since ebbed, “in part due to Fed assurances”.
- “Some of the sources said that pooling dollar reserves would face practical difficulties and may not be viable.”
- “Nevertheless, talks are ongoing at staff rather than top ECB policymaker level and involve central banks in the euro zone and outside the bloc, said four of the officials, who have direct knowledge of the matter.”
- Adam Posen of the Peterson Institute proposed something similar at an ECB conference two months ago – see Reuters reporting on that matter here.
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EURGBP TECHS: Monitoring Support Around The 50-Day EMA
- RES 4: 0.8835 High May 3 2023
- RES 3: 0.8800 Round number resistance
- RES 2: 0.8769 High Jul 28 and the bull trigger
- RES 1: 0.8725/8751 High Oct 10 / High Sep 25
- PRICE: 0.8718 @ 17:09 BST Oct 14
- SUP 1: 0.8675/8656 50-day EMA / Low Aug 10
- SUP 2: 0.8633 Low Sep 15
- SUP 3: 0.8597 Low Aug 14 and key support
- SUP 4: 0.8562 50.0% retracement May 29 - Jul 28 upleg
The latest bear leg in EURGBP appears corrective and trend signals remain bullish. Note that the cross has pierced support around the 50-day EMA, at 0.8675. A continuation lower and a clear breach of this EMA would signal scope for a deeper retracement towards 0.8633, the Sep 15 low. Key trend support lies at 0.8597, the Aug 14 low. On the upside, key resistance and the bull trigger is unchanged at 0.8769, the Jul 28 high.
SOFR OPTIONS: BLOCK: Dec'25
- 25,000 0QZ5 98.00 call spds, 1.25 net ref 97.035 at 1349:45ET, total volume on day at 105,000.
PIPELINE: Corporate Bond Update: $10B Goldman Sachs 5Pt Launched
- Date $MM Issuer (Priced *, Launch #)
- 10/14 $10B #Goldman Sachs $2.5B 4NC3 +67, $500M 4NC3 SOFR+92, $3B 6NC2 +77, $500M 6NC5 SOFR+108, $3.5B 11NC10 +92
- 10/14 $600M *KEB Hana Bank $300M 3Y SOFR+60, $300M 5Y +43
- 10/14 $3.2B Terawulf 5NC2 investor calls
