TheÂ EUR/USD currency pair today rallied briefly after aÂ speech byÂ theÂ European Central Bank President Mario Draghi following theÂ bank’s interest rate decision. TheÂ currency pair’s decline was triggered byÂ theÂ resurgence ofÂ theÂ US dollar following reports that top US government officials were heading toÂ China forÂ talks onÂ theÂ ongoing US-China trade war.
TheÂ currency pair initially rallied toÂ 1.2209 after Draghi’s hawkish speech before it dropped massively losing over 110 points toÂ hit aÂ low ofÂ 1.2097 atÂ theÂ time ofÂ writing.
TheÂ currency pair’s initial rally was triggered byÂ theÂ upbeat tone ofÂ Mario Draghi’s speech, which boosted theÂ euro. InÂ theÂ speech, Mario Draghi downplayed theÂ risks facing theÂ Eurozone following some dismal economic indicators inÂ theÂ recent past. TheÂ euro reacted poorly when theÂ ECB maintained theÂ status quo ofÂ its monetary policy decisions. TheÂ bank left its main interest rate atÂ 0.00%, while theÂ interest rate onÂ theÂ marginal lending facility was maintained atÂ 0.25%, andÂ theÂ deposit facility was kept atÂ -0.4%.
TheÂ pair’s decline was triggered byÂ news that President Donald Trump‘s chief economic advisor Larry Kudlow, andÂ theÂ US Secretary ofÂ theÂ Treasury Steven Mnuchin were traveling toÂ China. TheÂ duo are expected toÂ meet with top Chinese trade officials, which investors interpreted as sign of aÂ positive outcome forÂ theÂ US-China trade war.
TheÂ currency pair’s future performance is likely toÂ be affected byÂ tomorrow’s French GDP data, German unemployment data, andÂ theÂ US Q1 GDP data.
TheÂ EUR/USD currency pair was trading atÂ 1.2102 asÂ atÂ 19:46 GMT having declined from aÂ session high ofÂ 1.2209. TheÂ EUR/JPY currency pair was trading atÂ 132.36 having dropped from aÂ high ofÂ 133.25.
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