4 min readThe European Central Bank (ECB) has announced its latest interest rate decision, leaving interest rates unchanged at 2% for a third straight meeting. ECB awaits more clarity over how the US-EU trade agreement is impacting the Eurozone economy.
Data earlier today showed the Eurozone economy grew at 0.3% QoQ, faster than expected. Inflation remains close to the target at 2.2% YoY in September. The ECB sees the growth and inflation outlook as broadly unchanged and reiterated its meeting-by-meeting and data-dependent approach.
The Fed announced a hawkish rate cut yesterday, adding to market volatility. The market doesn’t see another ECB rate cut this cycle. Attention will turn to ECB President Christine Lagarde’s press conference.
EURO VS DOLLAR (EUR/USD):
If we take a closer look at the technicals, we can see that the price traded -0.44% at 1.1550 before the rate decision, and after the decision, it is trading -0.25% at 1.1570. However, there is still some volatility in the USD following yesterday’s Fed rate decision. On the 4-hour chart, the price is testing the 1.1550 support. A break below here brings 1.15 into focus.
EURO STOXX 50 (EUR50):
The EURO STOXX 50 initially saw a small decline following this ECB interest rate decision . Before the announcement, the price was trading -0.45% at 5665. Following the announcement the EURO STOXX 50 trades -0.55% at 5675, extending the pullback from its record high. On the 4-hour chart, the price has fallen below the 50 SMA buut is testing support around 5670, the October 2 high. A break below here brings 5600 into focus.
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