Euro Falls As ECB Decision In Focus
September 08 2021 - 3:35AM
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The euro depreciated against its major rivals in the European
session on Wednesday, as investors awaited monetary policy decision
from the European Central Bank for more hints on tapering of
emergency stimulus measures.
Solid economic growth and a surge in inflation fueled hopes that
policymakers could start a discussion on changes to its bond
purchases sooner rather than later.
European Central Bank policymaker Robert Holzmann told Eurofi
Magazine that the central bank is likely to normalize monetary
policy quicker than market expectations amid rising inflationary
risks.
Holzmann said that there are chances for upward price pressures
from persisting global supply bottlenecks, labor shortages, the
pent-up household demand, the cost effects of climate change
policies, and higher headline inflation getting entrenched into
inflation expectations.
European markets fell as a resurgence in Delta virus cases
raised concerns about a slowdown in global economic growth.
The euro declined to a 1-week low of 1.1812 against the
greenback and a 6-day low of 130.18 against the yen, off its prior
high of 1.1851 and a 5-day high of 130.70, respectively. The euro
may find support around 1.16 against the greenback and 128.5
against the yen.
The euro edged down to 1.0865 against the franc, after hitting
1.0892 for the first time since July 8. On the downside, 1.06 is
likely seen as its next support level.
The euro pulled back to 0.8584 against the pound, from a high of
0.8603 seen at 3:25 am ET. If the currency drops further, 0.84 is
seen as its next support level.
The European currency retreated to 1.6631 against the kiwi,
1.6016 against the aussie and 1.4969 against the loonie, after
rising to 1.6702, 6-day high of 1.6086 and near a 3-week high of
1.5020, respectively in early trades. If the euro drops further,
1.65, 1.56 and 1.48 are likely seen as its next support levels
against the kiwi, the aussie and the loonie, respectively.
Looking ahead, the Bank of Canada will announce its interest
rate decision at 10:00 am ET. The BoC is widely expected to keep
its policy rate steady at 0.25 percent.
Canada Ivey PMI for August and U.S. consumer credit for July
will be featured in the New York session.
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