Euro Falls to 2-Week Lows on Dovish Draghi Speech and Weak Data

The euro today fell to new 2-week lows following Mario Draghi’s introductory speech at the ongoing ECB Forum in Sintra, Portugal, which was interpreted as being very dovish. The EUR/USD currency pair was also weighed down by macro releases from Germany and the euro area, which missed expectations.
The EUR/USD currency pair today fell from a daily high of 1.1242 to a low of 1.1180 after Draghi’s speech and was near these lows at the time of writing.
The currency pair opened today’s session with a bullish bias driven by positive investor sentiment and the greenback’s weakness. The pair started falling after the release of Mario Draghi‘s speech at 8:00 GMT. The European Central Bank President said that he was open to further rate cuts as part of monetary policy measures to stabilize the eurozone economy. He also added that the ECB was open to using further quantitative easing measures as a tool to achieve the bank’s inflation target. Draghi confirmed that the ECB’s Governing Council would consider all options in the coming weeks to determine the best way forward.
The release of the disappointing German ZEW survey of economic sentiment for June also drove the pair lower as the survey expectations came in -21.1 versus the expected -5.9. The release of the weak eurozone CPI data for May by Eurostat also contributed to the decline.
The pair’s short-term performance is likely to be influenced by the US housing data and the scheduled speeches at the ECB forum.
The EUR/USD currency pair was trading at 1.1198 as at 11:22 GMT having fallen from a high of 1.1242. The EUR/JPY currency pair was trading at 121.23 having dropped from a high of 121.86.

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