The ECB is printing the results of its 18-month policy review!
What is the central bank saying? More importantly, how will it affect the euro’s prices?
Before moving on, ICYMI, today’s Asia-London session watchlist looked at CHF/JPY’s descending triangle support ahead of economic releases from both Japan and Switzerland. Be sure to check that out if it’s still a valid play!
And don’t forget to check our newly released real-time Currency Strength Meter!
Fresh Market Headlines & Economic Data:
Upcoming Potential Catalysts on the Economic Calendar:
What to Watch: EUR/CAD
In case you were too busy dancing to Ed Sheeran’s “Bad Habits,” then you’ll know that the European Central Bank (ECB) is printing the results of its 18-month policy review today.
Word around is that ECB President Lagarde and her team will be more specific about their inflation targets. Specifically, they’ll talk about targeting 2% and not just “below but close to 2%.”
However, they’re also likely to borrow from their neighbors and hint that inflation can overshoot the 2% figure while they keep their policies accommodative until they see more growth.
Prospects of easy policies for longer can weigh on the euro, which is 30ish pips away from a key range resistance against the Loonie.
If the ECB stays far away from tightening or tapering talks, then EUR/CAD could turn lower and drop back to its .4730 mid-range levels.
But if the central bank focuses on optimistic growth prospects, or if lower oil prices extend their downtrend and drags the Loonie with it, then EUR/CAD could finally break above its months-long range to retest its 1.4680 or 1.4800 areas of interest.