What’s next? – DAX 27.10.17

The DAX futures were 1.60 percent into positive territory on Friday at 13,147 points, as market players continued to digest the ECB decision to reduce monthly bond purchases.

Thursday’s data included the release of the GfK German consumer climate for November, which came in at 10.7 points, below an estimated reading of 10.8.

However, economic reports were not the main event of the previous session. Attention was mainly directed to the European Central Bank monetary policy meeting.

European policymakers decided to leave interest rates at a record low of 0.00 percent and the deposit facility at a negative rate of 0.40 percent. But rather than focusing on interest rate changes, traders were worried about the future of the bank’s stimulus program.

The European Central Bank announced that its asset purchase program will be extended until September 2018, although the volume of monthly purchases will be reduced to 30 billion euros from its current 60 billion euros target.

While this announcement was widely expected by world traders, the euro took a hit, falling across the board and leaving room for the US dollar to regain some ground.

Germany is currently leading the anti quantitative easing program movement within the bloc. However, ECB President Mario Draghi continues to defend the importance of monetary stimulus to keep the European Union economy healthy for the time being.

Jens Weidmann, governor of the Bundesbank and a hawkish member of the ECB, said recently: "I don't see the need to continue pressing on the gas pedal of monetary policy and we are doing just this if we continue to make further purchases every month."

No relevant economic data is scheduled in Europe for today.

Fort Financial Services