Chief Analyst at Danske Bank Jens Pedersen exepects the single currency to stay under pressure in light of the ECB meeting and the likely dovish tone from President M.Draghi.
“Today, focus will be on the central bank meetings at the ECB and the Riksbank. As we are unlikely to get any details on the ECB’s possible extension of QE beyond 2017, the main thing to look for is whether Draghi addresses some concerns about the past months’ pace of EUR appreciation”.
“With EUR/USD trading above 1.19 there could be some room on the downside for the cross if Draghi addresses the recent EUR appreciation. However, we maintain that dips in EUR/USD will be short-lived, and we believe any decline should be used to position for a further move up in EUR/USD on a 6 -12M horizon”.
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