Dovish ECB could spoil the Euro bulls’ party [Video]
![Dovish ECB could spoil the Euro bulls’ party [Video]](https://editorial.fxstreet.com/images/Macroeconomics/MonetaryPolicy/ECB/ecb-european-central-bank-66671665_XtraLarge.jpg)
Federal Reserve (Fed) Chair Jerome Powell’s testimony before Congress went smoothly yesterday. He said that the Fed will certainly cut the interest rates this year and that he’s not necessarily looking for inflation to hit the 2% target to start cutting rates. US yields and dollar fell, equities rebounded, and gold rose to a fresh all-time high.
Elsewhere, the Bank of Canada (BoC) left its rate unchanged at 5% at yesterday’ decision and the European Central Bank (ECB) will announce its latest policy verdict today. The European policymakers will leave rates unchanged but will revise inflation forecast down. The broad-based dollar depreciation sent the EURUSD above the 1.09 yesterday. A hint of a June rate cut from the ECB could quickly cast shadow on the euro bulls’ excitement to push this rally to 1.10 level.
Finally, the USDJPY falls steeply this morning as the Japanese wage growth accelerated at the fastest pace since June and the latter fueled speculation that the Bank of Japan (BoJ) could hike its rates already at this month’s meeting.
Author
Ipek Ozkardeskaya
Swissquote Bank Ltd
Ipek Ozkardeskaya began her financial career in 2010 in the structured products desk of the Swiss Banque Cantonale Vaudoise. She worked in HSBC Private Bank in Geneva in relation to high and ultra-high-net-worth clients.
