ECB’s momentous policy change to keep the EUR supported – Goldman Sachs

Dhwani Mehta FXStreet

Strategists at Goldman Sachs believe that the single currency could likely remain supported over the coming weeks amid hawkish ECB expectations.

Key quotes

"Our economists have a below-consensus growth outlook for the second half of the year and we think there are still significant downside risks from further gas disruptions, helping push near-term recession odds to around 40%.”

"But, at the same time we find it hard to be outright bearish on the Euro when the ECB is on the brink of such a momentous policy change: exiting negative rates after eight years. This week's Sintra meeting will likely help firm expectations for an imminent exit of negative rates and a broad anti-fragmentation "backstop."

Author

Dhwani Mehta

FXStreet

Residing in Mumbai (India), Dhwani is a Senior Analyst and Manager of the Asian session at FXStreet. She has over 10 years of experience in analyzing and covering the global financial markets, with specialization in Forex and commodities markets.

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