EUR/USD: Pair Hovers Around $1.13, pending ECB Decision


EUR/USD: Pair Hovers Around $1.13

EUR/USD Traders are waiting for today’s presser by Mario Draghi and therefore movements should be lower until the ECB meeting.

London – The single currency was calm on Thursday, hovering around $1.13 during the London session, with further volatility likely later in the session.

Later in the day, the European Central Bank (ECB) is expected to leave monetary policy unchanged, with the main refinancing rate staying at 0.0%, the deposit rate should remain at -0.4%, and the monthly pace of QE is projected to stay at €80 billion.

ECB head Mario Draghi might sound dovish at his press conference, mainly due to the continuous strength of the euro, but his recent speeches were not viewed positively and the single currency soared in December and March. Therefore, he must choose his words carefully if he wants to avoid another rally in the euro.

“While market consensus seems to be taking Mario Draghi at his word that there will be no more interest rate cuts (well at least taking his word that it wont be at this particular meeting), the way that he delivers his comments during the accompanying press conference is going to be key for price direction of the Euro,” Dane Williams at Vantage FX said on Thursday.

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From the US dollar perspective, the usual Thursday jobless claims data are due, along with the Philly Fed manufacturing index for April, which should decline from 12.4 to 8.0. Moreover, leading indicators for March will be published and are projected to pick up slightly.

In the previous session, existing home sales improved notably in March, advancing from 5.07 million to 5.33 million, which is a 5.1% monthly growth, easily beating the -7.3% month-on-month change booked in February.

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