The euro today spiked higher after the European Central Bank cut its deposit rate by 0.10% as expected before quickly reversing direction and crashing to new weekly lows. The EUR/USD currency pair had attempted to rally higher after the release of Germany’s consumer price index data earlier today given that the print met expectations.
The EUR/USD currency pair today spiked to a high of 1.1068 after the ECB decision before crashing to low of 1.0953 and was trading near these lows at the time of writing.
The currency pair had attempted to rally early in the Old Continent boosted by investor sentiment amid positive US-China trade headlines. The pair’s brief rally was further supported by the upbeat German CPI data released by the Federal Statistical Office. The monthly CPI print for August came in at -0.2%, while the annualized print came in at 1.4%; both prints met expectations. The currency pair spiked to its daily highs after the ECB published its monetary policy decision by slashing the deposit rate to -0.50% and maintaining the interest rate at 0.00%. The announcement of a new quantitative easing program starting November 1 triggered the pair’s crash.
The pair kept falling as Mario Draghi‘s speech got underway at 12:30 GMT given the release of the upbeat US CPI data for August by the Bureau of Labor Statistics at the same time. The upbeat US initial jobless claims data also drove the pair lower.
The currency pair’s short-term performance is likely to be influenced by Draghi’s speech and trade headlines.
The EUR/USD currency pair was trading at 1.0944 as at 12:38 GMT having crashed from a high of 1.1068. The EUR/JPY currency pair was trading at 117.74 having fallen from a high of 119.33.
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