Draghi Promises to Remain Accommodative; Euro Drops

Bonds in the euro area are on the rise, and the euro is losing ground, thanks to the latest remarks by Mario Draghi. He’s promised to keep monetary policy accommodative, and that means a lower euro for now.

President of the European Central Bank, Mario Draghi, has said that monetary policy will remain accommodative. Many Forex traders are taking that to mean that there is a good chance that the ECB will cut rates in the near future in order to help stimulate the eurozone economy.
At the same time, bond in the eurozone are on the rise. Italy and Spain, along with other peripheral countries, are seeing a boost to bonds following the announcement, which was made to the French National Assembly.
The assurance that the ECB stands ready to continue offering stimulative measures has many expecting that another rate cut could be coming soon, especially since the growth in the eurozone has been disappointing recently. The continued assurances of accommodation are in sharp contrast to what is happening in the United States, where there is talk of tapering off stimulus measures.
At 12:58 GMT EUR/USD is down to 1.3044 from the open at 1.3077. EUR/GBP is down to 0.8478 from the open at 0.8483. EUR/JPY is down to 127.1255 from the open at 127.9750.

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