After plunging earlier, EURUSD has reached stability and is ready to move forward.
The major currency pair has recovered and is now waiting for signals from the European regulator. The current quote for the instrument is 1.0712.
All eyes are on the European Central Bank today. The benchmark interest rate is expected to remain unchanged, at 0.0%, it’s not surprising. However, the European regulator should say something about its future moves and that’s very important.
Average market expectations imply two 25-point rate hikes in July and September. However, there is a scenario, according to which a hike in September might be 50 basis points because the ECB is clearly underestimating inflation and will have to act more aggressively in the future.
Also, today the regulator is expected to confirm that it’s going to close the QE programme until 1 July.
Most likely, the ECB’s inflation forecasts will be 2% by 2024. It’s rather unclear whether this target is possible or impossible to reach. but the regulator should stick to the target to give a confidence boost to capital markets and say that everything is coming along all right.
This slow return of the ECB to being more “hawkish” might provide the EUR with serious support.
Source: Roboforex
