EUR/USD picks up extra pace and regains the 1.18 mark and a tad above following the ECB’s interest rate decision.
EUR/USD navigates the 1.1800 neighbourhood after the ECB’s Governing Council left its monetary status quo on hold at Thursday’s event, matching the previous expectations.
In fact, the ECB left intact the interest rate on the main refinancing operations, the interest rate on the marginal lending facility and the deposit facility at 0.00%, 0.25% and 0 -0.50%, respectively.
The central bank said rates will remain at current/lower levels until inflation hits the 2% target. In addition, the ECB will buy bonds at a significantly higher pace than earlier in the year. Furthermore, the PEPP is expected to run until end of March 2022 or when the coronavirus pandemic ends and its size was affirmed at €1.85 trillion, with monthly purchases of assets at €20 billion
Moving forward, market participants will now closely follow the usual press conference by Chief Lagarde and the subsequent Q&A session.
So far, spot is gaining 0.02% at 1.1792 and faces the next up barrier at 1.1895 (weekly high Jul.6) followed by 1.1975 (weekly high Jun.25) and finally 1.2002 (200-day SMA). On the flip side, a breakdown of 1.1751 (monthly low Jul.21) would target 1.1704 (2021 low Mar.31) en route to 1.1602 (November 2020 low).