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What to expect? ECB Interest Rate Decision on Press Conference tomorrow.
Volatility Alert: EURUSD. Key ECB Meeting Ahead.
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A Key Event for the Euro on Thursday, June 14th, 2018.
ECB Interest Rate Decision (11:45 GMT) and ECB Press Conference (12:30 GMT).
Market watchers anticipate that the ECB’s Governing Council will discuss whether sufficient progress has been made to warrant a gradual exit from its long-term policy of ‘easy money’.
One of the most hawkish members of the ECB, Jens Weidmann, recently stated that he expects the programme to be over by the end of the year, at the latest.
Market experts are divided into 2 groups:
- Bullish factors for the EUR
- The Eurozone economy is still expanding.
- Inflation showed a healthy increase last month.
- Eurozone unemployment rate reached the lowest levels since 2008.
- Bearish factors for the EUR
- The pace of growth has slowed from last year’s decade high.
- The EU is set to retaliate against US tariffs.
- A Brexit deal is far from being agreed.
What do you think?
Will the ECB signal the end of its monetary stimulus? Or will it stay put for now and let the euro sink?
What is ECB Quantitative Easing Programme?
The ECB’s quantitative easing programme was launched in 2015 to fight off the threat of deflation (reduction of the general level of prices in an economy).
Currently, the ECB is buying bonds at a rate of $30 billion euro per month to contain borrowing costs, spur spending, and generate investments to stimulate inflation.
The expectation is for a gradual tapering of the ECB Quantitative Easing Programme, with a final purchase of $10 billion euro per month in the last quarter of 2018, followed by the first increase of interest rates in the first half of 2019.
