Pound regains some ground after euro’s Mario Draghi-inspired surge

Now it’s the U.S. Federal Reserve’s turn to decide.

Investors will look to USA data today for further indications of the health of the world’s largest economy and the trajectory of interest rates.

“European indices are expected to open around 1% lower on Friday, extending Thursday’s strong decline after the ECB failed miserably to meet the markets easing expect that policy makers had spent weeks building up”, notes Craig Erlam, at forex trading platform operator OANDA.

Spread betting quotes suggest the top-share index in the United Kingdom will open some 40 points down from last night’s close of 6,275, with investors still reeling from the European Central Bank’s underwhelming policy actions. Financials was the third-greatest decliner in the S&P, while Goldman Sachs contributed the most to declines in the Dow Jones average.

In an interview to the CNBC, Constancio said, “We have to recognize that the markets got it wrong in forming their expectations”. The dollar index traded back above 98.300 early on this morning after a heavy sell-off yesterday which was largely driven by the knee-jerk rally in the euro.

The ECB cut its deposit rate deeper into negative territory – effectively charging banks more for holding money with it – and said it would continue to buy government bonds and other assets until March 2017, six months longer than previously planned.

European markets were closed for the day when Draghi appeared. “They did indeed have higher expectations than were there and that’s why they reacted like they reacted but that was not our intention”, ECB Vice-President, Vitor Constancio told CNBC in Frankfurt. Australia’s S&P/ASX 200 retreated 1.5 percent to 5,151.60.

Gold priced in Euros sank to €980 per ounce – a level first reached on the way up as the Greek debt crisis broke in May 2010 – dropping 1.7% within 90 minutes to trade below its level at end-2014 for only the second time this year. Benchmarks in Taiwan and Southeast Asia also lost ground.

The single currency had come under fierce selling pressure leading up to the announcement – hitting a seven-month low against the greenback this week – as dealers positioned themselves for more far-reaching measures.

The dollar was at 122.66 yen against 122.61 yen Thursday in NY.

“It is worth keeping a close eye on this, because the likelihood of additional easing will largely depend on how financial conditions evolve from here”.

Brent crude futures climbed to $44.09 a barrel, having bounced back from Wednesday’s three-month low of $42.43.