EUR/USD drops to lows near 1.1770 post-ECB Spot dips to lows on ECB’s decision on QE. QE now seen running at €30 billion/month from January until September. Draghi’s presser now on sight. The single currency lost the grip after the European Central Bank left its monetary policy intact at today’s meeting, with EUR/USD around the 1.1770 area, or daily lows.
EUR/USD attention shifted to Draghi
The pair accelerated the downside after the ECB’s Governing Council left its monetary policy stance unchanged at today’s meeting, matching the broad consensus.
The European Central Bank left the interest rate on the main refinancing operations at 0.00%, the interest rate on the marginal lending facility at 0.25% and the deposit facility at 0 -0.40%.
ECB now sees QE running at €30 billion/month from January until September 2018, matching previous estimates.
EUR/USD levels to watch
At the moment, the pair is losing 0.36% at 1.1769 facing the next support at 1.1725 (low Oct.23) seconded by 1.1686..
ECB keeps rates on-hold, trims QE by EUR 30 bln per month and extended to Sept 2018 At its monetary policy meeting held today, the Governing Council of the European Central Bank (ECB) decided to leave the interest rates on the main refinancing operations and the interest rates on the marginal lending facility and the deposit facility unchanged at 0.00%, 0.25% and -0.40% respectively, while adding that it expects the “interest rates to remain at their present levels for an extended period of time, and well past the horizon of the net asset purchases.”
The ECB announced that the net asset purchases will be reduced to EUR 30 billion per month from the current monthly pace of EUR 60 billion from January 2018 and would be extended until the end of September 2018, “or beyond, if necessary.”
Attention now turns to ECB President Mario Draghi's speech at the 1230 GMT press conference, during which he may offer more clues on the future path of the monetary policy.
EUR/GBP retreats back to 0.8900 handle post-ECB decision • ECB leaves interest rates unchanged.
• Lowers the size of its bond purchase program to €30 billion per month.
The EUR/GBP cross extended its sharp retracement from levels beyond mid-0.8900s and is now headed to the lower end of daily trading range post-ECB announcement.
Currently trading around the 0.8900 handle, the cross met with some fresh supply after the ECB, on expected lines, left interest rates unchanged and decided to taper its billion monthly bond purchase program from current €60 billion to €30 billion per month.
The market, however, seemed slightly disappointed from the fact that the central bank extended its QE program until September 2018. Barring the initial reaction, the cross lacked any strong follow through momentum as focus now shifts to the post-meeting presser – with explanations behind the decisions and the ECB President Mario Draghi's speech.
Technical levels to watch
Omkar Godbole, Editor and ..
The European Central Bank kept its refi rate at zero percent and the deposit rate at -0.4 percent, as expected, but reduced its monthly asset purchases to EUR 30 billion from next year.
Following the decision, the euro dropped against its major rivals.
The euro was trading at 1.1784 against the greenback, 133.78 against the yen, 1.1696 against the franc and 0.8913 against the pound around 7:47 am ET.