ICE taking over?

The big news today for many traders is a bid from the Intercontinental Exchange (ICE) to purchase the Chicago Board of Trade (CBOT). Last October, it appeared to be a done deal that the Chicago Mercantile Exchange would buy out the CBOT for $8 billion, but now this hot ticket has apparently been placed back on the auction block at a 10% premium. While this might not affect the forex markets directly, it marks a significant historical ending to one of the oldest exchanges in the US. In other news, economic releases did little to move the markets. Market participants digested the PPI, TICS and Empire manufacturing indicators, all of which are big market movers in their own right and yet fairly useless in current market conditions. The highly-anticipated Consumer Price Index initially produced a bullish indicator, as headline inflation jumped 1.3 percent for the month of February and the core equivalent doubled expectations with a 0.4 percent increase. Upon closer inspection, however, the possible effect on Fed policy was a mixed bag, with few comments to back up the number. On the one hand, the 2.5 percent annual pace of price growth is still well below the rate seen in 2005 and the first half of 2006 that initially put the Central Bank on its habit of quarter-point rate hikes. Alternatively, the annual core report unexpectedly held its 1.8 percent. In terms of updated expectations for the CPI data tomorrow, the initial outlook for a slight pick-up in the headline numbers seems to be well-supported by today’s PPI and yesterday’s import price index. The EUR/USD was trading in timid ranges around 1.3215, moving only a bit higher to close out the American sessions at 1.3234.
David Hilgeman, XPRESSTRADE Analyst