ECB Insurance Hike Seen Limiting EUR/USD Upside – OCBC
OCBC analyst Sim Moh Siong expects the ECB to deliver a one-off 25 bps ‘insurance’ rate hike to 2.25%, with updated projections showing higher inflation and weaker growth, which may limit EUR/USD upside.
OCBC’s Sim Moh Siong expects the European Central Bank (ECB) to deliver a 25 basis point ‘insurance’ hike at its upcoming meeting, bringing the deposit rate to 2.25%.
According to Siong, updated ECB staff projections will likely show higher inflation and weaker growth forecasts, which could cap gains in the euro against the US dollar.
The analyst views the move as a one-off adjustment rather than the start of a tightening cycle, adding that the rate decision and projections will be key for EUR/USD direction in the near term.
Source: FXStreet Forex News