When is the European Central Bank (ECB) rate decision and how could it affect EUR/USD? – by hareshmenghani ECB InterestRate Inflation EURUSD Currencies
eeting press conference at 13:45 GMT. The minutes of the ECB’s October meeting backed the case for a dovish shift. That said, the recent comments by ECB officials cast doubt on whether the central bank will actually slow its rate-hiking cycle. The current market pricing, meanwhile, assigns a circa 87% chance of a 50 bps lift-off at the end of the December policy meeting.
Analysts at Commerzbank offer a brief preview of the event and write: “The ECB is unlikely to decide on another jumbo rate step of 75 bps but instead opt for 50 bps. This is supported by quite a few statements by members of the ECB Council. The ECB's updated inflation projections also argue for a slower pace of rate hikes.
Eren also outlined important technical levels to trade the EURUSD pair: “On the downside, 1.0600 on the four-hour chart, psychological level) aligns as interim support ahead of 1.0580 . In case EUR/USD drops below the latter and fails to reclaim it, it could extend its slide toward 1.0550 and 1.0500 .”
“1.0630 forms initial resistance. If EUR/USD manages to stabilize above that level, it could target 1.0660 and 1.0700 ,” Eren adds further.
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