EUR/USD Holds June Range- Outlook Hinges On ECB Forward Guidance

Video length: 00:37:22

– ECB to Retain Zero-Interest Rate Policy (ZIRP), EUR 60B/Month QE Program.

– Will the ECB Extend the Asset-Purchase Program Beyond December?

Trading the News: European Central Bank (ECB) Interest Rate Decision

DailyFX Calendar

The European Central Bank (ECB) interest rate decision may shake up the near-term outlook for EUR/USD as officials release their updated forecasts, and the single-currency may struggle to hold its ground amid reports the Governing Council will reduce its inflation forecast through 2019.

Why Is This Event Important:

Indeed, the ECB keep the door open to further embark on its easing-cycle as ‘measures of underlying inflation remain low and are expected to rise only gradually over the medium term,’ and a downward revision in the economic projections may undermine the near-term advance in EUR/USD should President Mario Draghi & Co. show a greater willingness to carry its asset-purchase program into 2018. However, unless the ECB decides to move the deadline, the ECB may have little choice but to alter the forward guidance for monetary policy as the quantitative easing (QE) program is set to expire in December. With that said, the resilience in EUR/USD may gather pace over the near-term if the Governing Council shows a greater willingness to further wind down its asset-purchases over the coming months.

Impact that the ECB rate decision has had on EUR/USD during the previous meeting

Period

Data Released

Estimate

Actual

Pips Change

(1 Hour post event )

Pips Change

(End of Day post event)

APR

2017

04/27/2017 11:45 & 12:30 GMT