European Central Bank

The European Central Bank has recently prepped markets for a pending uplift in its interest rates and chief economist Philip Lane suggested this week that it could now look to “validate” market expectations with actions, although this might have mixed blessing for the Euro to Dollar exchange rate.

"For the euro to find additional support there would have to be increasing signs that the ECB is hiking rates more quickly and that it might even be considering 50bp steps"

Europe’s inflation rates leapfrogged the market consensus again when climbing to new records for the month of May, vindicating in the process an shift in the monetary policy stance underway at the European Central Bank (ECB) but also likely adding fuel to an already impassioned debate.

Euro exchange rates rose at the start of the new week after European Central Bank President Christine Lagarde cemented expectations for a July interest rate hike.

July rate hike now very likely at the ECB with a 50bp hike now preferred, this is supportive of EUR for now but any pushback by the central bank could undermine recent gains.

The European Central Bank (ECB) looks increasingly likely to raise interest rates in July with one member of the Governing Council warning a surprisingly large hike could be delivered.

ECB Governing Council member François Villeroy de Galhau expressed concern that the Euro was too weak and was therefore contributing to inflation.

The Euro to Dollar rate has remained close to five-year lows even as market expectations have shifted in favour of a sharp uplift in European Central Bank (ECB) interest rates this year and HSBC says this likely reflects worries about the Eurozone economy and risks of financial fragmentation.

The Eurozone's economy is seeing growth slow and inflation rise, but analysts say the European Central Bank might have to prioritise its fight against inflation at the expense of growth by raising rates.

The European Central Bank is on course to raise interest rates as soon as July according to a new report which has attracted analyst attention at the start of a new week, but there is a concerning detail in the report for Euro 'bulls'.

The ECB is trying to "dampen inflation expectations and euro decline," says Nick Kounis, Head of Financial Markets at ABN AMRO.

Euro exchange rates are up in midweek trade, with speculation of an approaching interest rate rise at the European Central Bank possibly driving demand.

The Euro was lower in the wake of the European Central Bank policy update that offered no hint that interest rate rises at are imminent.

The ECB is becoming increasingly restive on its monetary policy stance and looks keen to 'normalise' interest rates in the face of surging Eurozone inflation, which could offer the Euro support over coming weeks.

Switzerland’s Franc has risen against the Euro and many other European counterparts thus far in 2022 but with the tectonic plates of the global interest rate landscape shifting steadily, it may find itself at growing risk of a depreciation against a range of currencies as the year goes on.

EUR/USD underpinned by ECB’s policy stance that sees it take “conditional” step toward normalisation.

The Euro to Pound Sterling exchange rate rose a third of a percent to 0.8423 in the wake of the decision, putting the Pound to Euro rate at 1.1872.

ECB Chief Economist Philip Lane has pushed back against market expectations for a number of interest rate rises in 2022, saying the ECB could accommodate a temporary rise in inflation.

Euro bulls have misread the European Central Bank's intentions on policy normalisation warns a major European bank which sees the Deposit Rate remaining below 0% even once hikes have been delivered.

Nordea sees 25bp hike due in December, Berenberg says March lift-off as more likely.  Timing matters greatly for EUR exchange rates.