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EUR/USD: rate decision and press conference of the ECB _21/04/2016

Technical analysis and trading recommendations -

The absolute center of attention in the financial markets today is the ECB's decision on interest rates and a press conference by ECB President Mario Draghi, who will start today at 11:45 and 12:30 (GMT) respectively.

Changes in the interest rate in the Eurozone is not expected today, and it will remain the same (0% - the main interest rate 0.4% - the rate on deposits). However, what says M.Dragi in the subsequent press conference, will depend on the subsequent dynamics, as the euro, the European indices as well as the entire financial market.
Recall that after a similar decision in December EUR / USD pair rose by 5% in response to the rhetoric and the text of the statement M.Dragi.

At this time, the movement in the EUR / USD pair may also be unpredictable.

Despite the ECB's successive efforts on the growth of inflation and support the euro area economy, the effect of the bank's actions is still insufficient. According to the key figures of the European Central Bank, if prospects worsen, "lower interest rates will be one of the possible options." Compared to the US stock market, which is almost fully recovered after falling in December 2015, the European stock market is not yet regained their losses. Thus, the European stock index rebounded EuroStoxx50 at just over 50%, CAC40 - by 60%, DAX30 - also almost 60%.

Published yesterday, the index pointed to another decline in prices of German producers in March (-3.1% vs. -2.9% expected and -3.0% in March) on an annualized basis. Released earlier in the week the index of the current economic environment of the ZEW Institute in Germany, whose economy is the engine of the whole European economy was in April, below the forecast (47.7 vs. 51.0, and 50.7 in March).

Also a negative impact on the recovery of the European economy has the expectation results of the referendum in the UK, scheduled for the end of June. Possible UK exit from the Eurozone have a negative impact both on the economy and the stock market of the United Kingdom and the euro area.

Thursday, 21 Apr, 2016 / 9:26

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