Euro Drops Against Peers on Draghi Speech and ECB Rate Decision

The euro today headed lower after the European Central Bank‘s interest rate decision and the press conference following the announcement. The euro gave up most of yesterday’s gains that were triggered by President Donald Trump‘s decision to remove the pre-announced tariffs on car imports from the EU.
The EUR/USD currency pair today dropped from a high of 1.1743 to a low of 1.1670 after Mario Draghi’s speech.
The currency pair was on a downtrend from the Asian session, which was accelerated by the release of the German GfK consumer confidence survey in the early European session. The GfK data came in at 10.6 missing expectations by 0.1 and dragging the euro lower. The ECB rate decision announced via the Governing Council’s monetary policy statement also did not boost the pair. The bank left its rate decision at 0.00% and its marginal lending facility at 0.25%; both prints were in line with expectations.
In his press conference, Mario Draghi confirmed the outlook for inflation and economic growth, which is why the bank did not change its monetary policy. However, he remained vague on the meaning of Summer 2019 as mentioned in the monetary policy statement, which investors interpreted as being dovish. The release of the weak US advance goods trade balance and the disappointing initial jobless claims data had a minimal impact on the currency pair.
The currency pair’s future performance is likely to be affected by tomorrow’s Q2 GDP releases from France and the USA.
The EUR/USD currency pair was trading at 1.1678 as at 14:07 GMT having dropped from an initial high of 1.1743. The EUR/JPY currency pair was trading at 129.70 having declined from a high of 130.15.

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