Categories: Market Overview

Euro falls sharply as ECB’s Draghi clears path for more stimulus

European Central Bank (ECB) President Mario Draghi defended the tools that the institute has available on Tuesday, saying that it could cut interest rates again or provide further asset purchases if inflation doesn’t reach its target.

Speaking at the ECB Forum in Sintra, Portugal, Draghi gave a defiantly dovish tone, saying that if the economic situation deteriorates in the coming months the bank would announce further stimulus. The euro dropped 0.2% against the dollar in a matter of minutes as Draghi delivered the remarks. The German 10-year bund yield hit -0.30% for the first time ever and the U.S. 10-year Treasury yield hit its lowest since September 2017 at 2.0475%.

The ECB foresees “lingering softness” in the short term, in particular due to geopolitical factors and trade conflicts, which have weighed on exports and on the manufacturing sector — two important drivers of economic growth in the euro zone. Earlier this month, the ECB revised its interest rate expectations, adding that its first-post crisis rate hike is unlikely to come before mid-2020. This dovish stance shows the central bank is doubtful about economic recovery in the 19-member region.

Euro falls sharply as ECB’s Draghi clears path for more stimulus, CNBC, Jun 18
AddThis Website Tools
The FxPro News Team

This team of professional journalists announces the most interesting and influential articles from the major financial media as a brief summary. All such news may have sufficient potential to affect the course of trading assets.

Share
Published by
The FxPro News Team
Tags: ecb

Recent Posts

NZDUSD Wave Analysis 10 January 2025

- NZDUSD falling inside weekly impulse wave C - Likely to fall to support level…

4 hours ago

GBPUSD Wave Analysis 10 January 2025

- GBPUSD broke key support level 1.2300 - Likely to fall to support level 1.2100…

4 hours ago

WTI crude oil Wave Analysis 9 January 2025

- WTI crude oil reversed from support level 72.25 - Likely to rise to resistance…

1 day ago

USDCAD Wave Analysis 9 January 2025

- USDCAD reversed from support zone - Likely to rise to resistance level 1.4450 USDCAD…

1 day ago

GBPCHF Wave Analysis 8 January 2025

- GBPCHF reversed from resistance zone - Likely to fall to support level 1.1200 GBPCHF…

2 days ago

USDJPY Wave Analysis 8 January 2025

- USDJPY broke resistance level 158.00 - Likely to rise to resistance level 160.00 USDJPY…

2 days ago