© O Financista. EUR/USD plunges after ECB
Investing.com – The EUR/USD pair has suffered severely from the ECB meeting this Thursday march 7, 2019, and, plunging after the publication of the statement of the ECB at 13: 45.
The Euro-Dollar has in fact marked a low daily 1.1247 for the moment, the lowest since February 15, after a peak at 1.1319 this morning
The European Central Bank has surprised by announcing from the outset, launching an operation TLTRO, while most observers were expecting to simple indices in this sense.
Even more surprising, the ECB has amended its “forward guidance” on rates, stating now that no rate hikes will occur this year.
The press conference of Mario Draghi was then further weighed on the Euro, with the announcement of severe downward revisions on the forecasts of growth and inflation 2019.
The growth forecast from +1.7% to +1.1%, while the forecast of inflation from 1.6% to 1.2%.
Draghi has also stressed that the european economy is in a state of “continuous weakness,” adding, however, that the chances of recession in the euro area are ” very low “.
Therefore, it would have been difficult to imagine a meeting of the ECB more dovish than what has been offered today by Mario Draghi and his team.
On the EUR/USD reaction to the ECB meeting, which exceeded expectations already dovish tone of the market is no surprise sharply to the downside. The media of 1.13, and 1.1275 have been broken, and the support of 1.1250 is tested at the time of the writing of this article.
Lower, the next support potential is situated on 1.1233, the lowest annual 2019, then that 1.1213, the low of last year, before the psychological threshold of 1.12.
Finally, it should be noted that ABN AMRO bank (ACES:ABNd) was one of the first to respond in regards to the impact on the EUR/USD, believing now that the Euro-Dollar will fall to 1.10 before the end of the first half.