European Central Bank

The Euro has stabilised after European Central Bank President Christine Lagarde attempted to cool building market expectations for higher Eurozone interest rates in an appearance before EU lawmakers.

EUR/USD eyes 1.14 on ECB inflation warning, drives rally in EUR/GBP & squashes GBP/EUR.

"The main risk to our ongoing EUR bearishness has to be the possibility that the ECB changes tack in a hawkish direction" - Credit Suisse.

"Our strategists would expect EUR/USD to rise materially above 1.20 by next year" - Deutsche Bank.

EUR/USD steadies after retreat back below 1.14, but ECB-Fed divergence set to grow heavier still.

Pound Sterling has already breached Credit Suisse's forecast target against the Euro, leading the Swiss bank to raise a new target and affirm their bullish stance on the UK currency against its continental rival in 2022.

EUR/USD through 1.13 after ECB saysPEPP to end in March.

The single currency has rallied against the Pound and Dollar, helped by supportive comments from council members of the European Central Bank.

Euro exchange rates were softer in midweek trade and faced a challenging outlook after the ECB's Lagarde sent markets a clear message that they were wrong to expect interest rate rises as soon as 2022.

The Euro rate got little help from October’s ECB monetary policy decisions and struggled to compete with a Dollar that has benefited from the prospect of a further shift in stance at an almost-hawkish Fed.

"The move smacks of some of the ECB hawks trying to open up the debate on monetary normalisation"

EUR/USD attempted to draw a line under a hat-trick of losses but was struggling for momentum on Thursday after the ECB reduced slightly the pace of bond purchases under one of its quantitative easing programmes and hinted that a further reduction could come in December.

Those betting on a stronger Euro against the Pound were left disappointed after the European Central Bank (ECB) met expectations and said it would lower the pace of its pandemic era quantitative easing programme.

The Euro-Dollar rate saw only a tepid rebound on Thursday as the Euro lagged other comparable currencies in capitalising on widespread declines by Dollar following new ‘dovish’ guidance from the European Central Bank (ECB), which confirmed that an age of near-zero interest rates continues to loom over the path ahead for the Eurozone.

Pound Sterling's recovery against the Euro gathered momentum in the wake of the European Central Bank's July policy update.

"Continued dovishness from the ECB will pave the way for increased policy divergence in the near-term and weigh on the Euro."

The European Central Bank’s new inflation-targeting strategy could lead to an even more protracted period of quantitative easing (QE) than has previously been anticipated by economists and is similar in its market implications to that of the Federal Reserve (Fed), although the strategy could be better understood as a reflection of the ECB having learned from the mistakes of the past rather than as a response other central banks’ policies.

The Euro was seen bid against most major currencies in the wake of headlines concerning the outlook for European Central Bank policy.

Euro exchange rates could find some life on Thursday's policy meeting at the European Central Bank which will offer some key guidance as to where Eurozone monetary policy is heading over coming months.

The Euro-Dollar exchange rate briefly led a resurgence of the single currency complex Thursday in an apparent response to the April monetary policy statement of European Central Bank (ECB) President Christine Lagarde, whose words conveyed a creeping sense of cautious optimism.