Euro Rallies to New Highs After ECB Rate Decision and TLTRO Terms

The euro today rallied to new multi-week highs when the European Central Bank announced the terms of its TLTRO III facility, which were better than expected. The EUR/USD currency pair had traded lower following the ECB rate decision but spiked higher after Mario Draghi‘s speech.
The EUR/USD currency pair today rallied from a session low of 1.1200 to a high of 1.1308 after the TLTRO III unveiling and was near these highs at the time of writing.
The currency pair opened today’s session trading sideways amid subdued market action as investors waited for the ECB event. This meant that the pair had a muted reaction fo the release of upbeat German factory orders for April by the Federal Statistical Office. The pair also had a subdued reaction to the release of mostly in-line eurozone employment data for Q1. The release of the in-line eurozone Q1 GDP report by eurozone Q1 GDP report also had a minimal impact on the currency pair. The announcement of the ECB Governing Council‘s monetary policy decisions caused the pair to drop to its daily lows given the ECB’s dovish stance.
However, the pair quickly rallied to its daily highs after the ECB unveiled the details of its new targeted longer-term refinancing operations (TLTRO III). The terms were better than expected, which caused the pair to rally by over 100 points.
The fiber’s future performance is likely to be influenced by tomorrow’s German trade balance data and US Non-farm payrolls report.
The EUR/USD currency pair was trading at 1.1289 as at 17:49 GMT having rallied from a low of 1.1200. The EUR/JPY currency pair was trading at 122.17 having risen from a low of 121.19.

If you have any questions, comments, or opinions regarding the Euro, feel free to post them using the commentary form below.

Leave a Reply

Your email address will not be published. Required fields are marked *