Christine Lagarde resigns from the ECB- EUR/USD lifts

Around 30 minutes ago rumours circulated that the head of the European Central Bank, Christine Lagarde was going to resign. Well, in the last 15 minutes that has been confirmed and interestingly the immediate reaction was to push the EUR/USD higher. That is quite an indicative reaction to what the markets thinks about this news. 

As to who will replace her remains to be seen and if it is a ultra-hawk that could deliver an interesting new dimension to the ECB. Earlier the EUR/USD traded as low as 1.1125 and then traded as high as 1.1152 following this news. We should note that Lagarde will not be leaving immediately. She is set to depart sometime in February. 

It is also interesting that she has made this announcement right ahead of the ECB policy decision and some have concluded this means a greater chance of a rate hike today, but we are not so sure that is the right inference. Nevertheless, we are keeping an open mind on that, whilst repeating the consensus is they will not change rates today. Either way we shall find out in the next 90 minutes whichever way this goes. The EUR/USD is right now at 1.1148