During the session of this Thursday, January 23rd, 2020, the EUR continued its bearish trend after the publication of the ECB meeting minutes which came as no great surprise to the markets. Let's take a look at the details of this data together with some tips on how to take a position on this currency cross.
During Thursday's session, the EUR continued to lose ground against the U.S. Dollar and following the meeting of the ECB or European Central Bank, which came as no great surprise to investors.
More generally, the market seems to be more focused on safe havens at the moment, especially with the Chinese Coronavirus outbreak that has been worrying traders for the past few days now.
Thus, at the end of the session, the euro was down 0.33% against the greenback and the EUR/USD cross was trading at 1.1056 pips.
Also during this Thursday's session, we have therefore taken note of the minutes of the European Central Bank's meeting, which confirmed its monetary policy and therefore announced that it would maintain its main key rate while continuing its public and private debt buyback programme. In this way, the organization reinforces the arsenal of support for the economy that it had put in place and adopted in September under the leadership of Mario Draghi, its former president.
The new President of the ECB, Christine Lagarde, also spoke positively yesterday. It therefore considered the economic risks to be less pronounced now that a trade truce has been declared between the United States and China. Furthermore, she described the progress in the discussions between the United States and Europe on trade as "positive".
Commenting on Christine Lagarde's statements, Brendan McKenna of Wells Fargo said, "She delivered her message perfectly, she said nothing revolutionary to suggest an imminent change in monetary policy."
It should also be noted, however, that the European Central Bank has recently launched a review of its current strategy, which will be a major undertaking. Christine Lagarde therefore hopes to see this project completed by November or December 2020, but not before. In the meantime, the status-quo is to be favoured.
According to data from the EUR/USD technical analysis, the currency pair is expected to move mostly lower in the coming hours. However, we will monitor the possibility of a wave of low-priced purchases if a significant threshold of support is reached. Of course, we will also keep an eye on the economic calendar in search of impacting data.