The main currency pair came to 1.1300 level on the back of results of ECB’s meeting. EUR/USD is trading significantly higher on Thursday. Currently it holds at 1.1298 and has gained 0.5% today.
Apparently, the reason for such rise of the pair is the results of ECB’s September meeting. As many anticipated, the rate was kept at zero level. Deposit rate was also kept at -0.4% per annum, cardinal product rate wasn’t changed also and is kept at 0.25% per annum. The quantitative program will follow previously agreed conditions – the ECB will be buying assets in the amount of 80 billion euro annually.
So far the situation goes in line with expectations of market players and economists. The QE program is to be carried out until March 2017 and the total amount of it will be 1.7 billion euro. However, most likely it will be prolonged. At least, 80% of the currency market participants think so. It may happen that ECB will alert about this ahead of time. According to market rumors, we might hear about it in October or December. Bearing in mind that ECB tries to avoid sharp market fluctuations this seems to be logical.
Later today Mario Draghi holds a press conference, but we doubt if he says anything principally new. It is not yet the time for loud statements. EUR/USD will try to hold above 1.1300, but without support that’s going to be a sweat.
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