4 min readThe European Central Bank (ECB) has announced its latest interest rate decision, leaving rates unchanged at 2% for the fourth consecutive meeting. The decision comes as inflation remains around the ECB’s target and the economy shows resilience amid global trade shocks.
The ECB raised its growth projection, driven especially by domestic demand. While the new projections don’t provide a reason for changing rates, which are considered neutral, they do add a slightly hawkish edge to the mood. The market is not expecting the ECB to cut rates again this cycle.
US CPI data was also released just after the rate decision. The cooler-than-expected CPI reading has weighed on the USD and boosted stocks, adding to the market reaction.
EURO VS DOLLAR (EUR/USD):
If we take a closer look at the technicals, we can see that the price traded -0.20% at 1.1720 before the rate decision, and after the decision (and after US CPI data), it is trading +0.02% at 1.1740. On the 4-hour chart, the price is testing the 1.1750 resistance. A break below here brings 1.1830 into focus.
Trading involves risk.
EURO STOXX 50 (EUR50):
The EURO STOXX 50 has risen following this ECB interest rate decision and US CPI data . Before the announcement, the price was trading 0.34% at 5705. Following the announcement the EURO STOXX 50 trades 0.52% at 5713 On the 4-hour chart, the price trades within a triangle pattern, recovering from the 200 SMA and rising trendline at 5670. Buyers will look to rise above 5720 the falling trendline to extend gains towards 5760.
Trading involves risk.
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