EUR/USD to be pressured into ECB Dec – BTMU

By FXStreet FXStreet (Guatemala) – Analysts at Bank of Tokyo Mitsubishi, explained that the euro is likely to remain under downward pressure against the US dollar heading into the ECB’s upcoming policy meeting in early December.

Key Quotes:

“ECB Chief Economist Praet has provided a further clear signal that the ECB will soon ease policy further. He struck a dovish tone expressing concern that inflation expectations could become unanchored and the ECB could lose policy credibility if it delays the projected return of inflation to target. He added as well that the zero lower bound may be lower than the ECB thought months or years ago.

The comments signal that the ECB is unlikely to disappoint market expectations for at least a 0.10 point reduction in the deposit rate, and will likely leave the door open as well for further reductions if required. The ECB is expected to extend the duration of their QE programme at least into the first half 2017, and potentially increase the pace of monthly purchases as well.

In marked contrast the Fed remains on course to begin raising rates in December. It has been well flagged by the Fed who is also reiterating that rates will rise only …read more

Source:: FX Street