On Thursday, currency traders were counting down the policy decisions of the ECB and the Bank of England.

Market prepared to wait on central banks

• Services PMIs to show European recession still main scenario

• All data points to further monetary easing from CBs tomorrow

• Independence Day in the US means a quiet market

• Bob Diamond at the TSC from 2pm

According to the first estimate, euro zone CPI inflation stabilized in June, in line with expectations. The headline index stabilized at 2.4% Y/Y, after showing a downward surprise in May.

Italy beats Germany

Market expectations were very low going into the meeting and this time the political leaders managed to deliver more than expected in the market. Despite a substantial difference in opinion between Germany on one side and Italy, Spain and France on the other, Italy’s Mario Monti managed to persuade Germany to support short-term measures.