The EUR/USD pair dipped even after the latest hawkish statement by Christine Lagarde and the weak American consumer inflation data.
Enter your emailThe pair will likely continue falling as bears target the key support at 1.0450.Timeline: 1-2 days.dipped even after the latest hawkish statement by Christine Lagarde and the weak American consumer inflation data.GET STARTEDThe European Central Bank started a meeting in Portugal in which officials are deliberating on the state of the economy. In a statement on Tuesday, Christine Lagarde hardened her views about inflation.
At the same time she added that there were “clearly conditions in which gradualism would not be appropriate.” This means that the bank could hike rates by more than the 0.25% target that the ECB has guided.. The Fed has hiked by 150 basis points while the ECB has boosted rates in the past five straight meetings. The ever-dovish Swiss National Bank surprised investors by delivering a 0.50% increase in the most recent meeting.
The bank is in a difficult situation because of the state of European countries. While some members like Germany and France have strong economies, others like Italy, Spain, and Greece have significant debt challenges. This explains why the ECB held an emergency meeting this month to deliberate on the widening Germany and Italy bond yields spreads.
The EUR/USD pair also dropped after data showed that consumer confidence was falling. According to Conference Board, consumer confidence dropped from 103 in May to 98.7 in June this year. This was the worst drop in over 9 years. It was also substantially lower than January’s high of 113.8. Additional data showed that the American house price index jumped sharply in May while the country’s goods trade deficit remained above $103 billion. The key catalysts for the pair will be the upcoming statements by Lagarde and Powell.The EUR/USD pair gushed lower on Tuesday as investors reflected on multiple data points. On the four-hour chart, the pair managed to move below the
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