Central banks have been ever-powerful in markets: support for stocks via the Bernanke Put, Draghi's “Whatever it Takes” and Kurdoa's Shock and Awe QQE are prime examples. They not only gave boosts to stock markets but also pushed down the currencies, thus making exports more competitive.

Yet recently, it seems that these very powerful institutions with their role as creators of money are losing their shine and markets are losing their faith.

Doubts about Draghi, Fear about the Fed

It began when Master Mario Draghi created huge expectations and didn't fully deliver. This resulted in the biggest leap in EUR/USD in 6 years and Draghi admitted his disappointment, trying to do some damage control but to no avail. That was December 3rd 2015.

Two weeks later, the Fed made its historic rate hike. Markets were well prepared and the delivery was deemed successful. Until things turned sour in the New Year. The global deterioration often blamed on China but also on oil prices eventually reached the Federal Reserve that not only raised rates prematurely according to critics, but also went hawkish by setting the stage for 4 hikes in 2016.

Markets never fully believed the Fed, and after a few more disappointing data points on the US economy during January, sentiment further deteriorated despite a confident approach from the Fed late in the mont. But perhaps the starkest example came when Janet Yellen on February 10th. She tried to sooth markets by talking about watching financial conditions while trying to look confident.

But markets didn't buy it. 

Further sell-offs and a the next hike priced in only somewhere in 2018 basically tells the Fed it doesn't know what it's doing. What good news does the Fed know that we don't? Doubts are seen everywhere.

Japanese Frustration, Chinese Hope

And also in Japan, the ever-powerful governor Kuroda, that managed to talk up USD/JPY from 116, later push it up t 121.50 with setting a historic negative deposit rate (fighting internal opposition) was probably tearing his hair off watching USD/JPY plunge all the way to the 110 handle.