ECB leaves interest rates on hold, EUR/USD slumps ahead of press conference and US Q4 GDP

EUR/USD Forecast – Prices, Charts, Analysis

• The ECB will leave all policy instruments in place.
• EUR/USD is currently stuck within a 30-tick range.

Most read: Euro Q1 technical forecast: mixed picture

As expected, the European Central Bank has so far left all policy settings unchanged. In a prepared statement accompanying the announcement, ECB President Lagarde said the following, but the content was barely understood.

“The ECB’s key interest rate is at a level that, if maintained for a sufficiently long period of time, will make a significant contribution to this goal.” Future decisions by the Governing Council will set the policy rate at a level that is sufficiently restrictive for as long as necessary. This is guaranteed. ”

Interest rates on major refinancing operations, marginal lending facilities, and deposit facilities will remain unchanged at 4.50%, 4.75%, and 4.00%, respectively.

Stay tuned for real-time updates on all market moving events and data releases. DailyFX Calendar

Financial markets are predicting a 125 basis point (bp) cut in interest rates this year, the same level as before the announcement.

ECB suggested interest rate and basis points

The euro was little moved following the announcement, moving within a narrow range against the US dollar. The pair has traded between 1.0870 and 1.0902 so far today, and traders believe the upcoming ECB press conference (13:45 UK time) could add some volatility to the currently lackluster pair. I’m sure you’re hoping it won’t happen. Support is seen at the 200-day simple moving average (black line on the chart), which is just below 1.0850, but if there is no strength in today’s US Q4 GDP numbers, he could move above 1.0950. It will be difficult to break through.

EUR/USD daily chart

Charts using TradingView

According to IG Retail Trader data, 49.86% of traders are net long, and the ratio of traders short to long is 1.01:1. The number of traders who are net long is 6.55% lower than yesterday and 1.53% lower than last week. The percentage of traders who are net short increased by 6.42% from yesterday and by 1.40% from last week.

To see what this means for EUR/USDDownload the full retail sentiment report below

what do you think about EUR – Bullish or Bearish?? Let us know using the form at the end of this article or contact the author via Twitter. @nickcawley1.