Euro Slides As Draghi Warns Of Global Headwinds Still Hammering Economy

Trading 10 avr 2019 Donner votre avis

The euro drifted lower against its major counterparts in the European session on Wednesday, after the European Central Bank President Mario Draghi struck a cautious tone about the euro area economy, saying that global headwinds continued to weigh on growth developments and deteriorate economic outlook.

In his customary press conference in Frankfurt, Draghi acknowledged that incoming information since the last meeting in March confirmed lower growth momentum extending into the current year.

Even though certain domestic factors curbing growth are waning, global headwinds continue to weigh on euro area growth developments, Draghi warned.

Continued uncertainties stemming from geopolitical factors, the threat of protectionism and vulnerabilities in emerging markets have dampened economic sentiment.

The risks surrounding the euro area growth outlook remain tilted to the downside in the wake of geopolitical uncertainties, protectionist threats and emerging market slowdown, he added.

Draghi reiterated that interest rate would remain at the current level at least through the end of 2019, and in any circumstance for as long as necessary to ensure the continued sustained convergence of inflation to levels that are below, but close to 2 percent over the medium term. At its monetary policy meeting, the Governing Council left the interest rates on the main refinancing operations, the marginal lending facility and the deposit facility unchanged at 0.00 percent, 0.25 percent and -0.40 percent, respectively.

The currency held steady against its major counterparts in the Asian session, with the exception of the yen.

The euro lost 0.5 percent to a 2-day low of 1.1230 against the greenback, after rising to a new 2-week high of 1.1287 at 8:30 am ET. At yesterday's close, the pair was valued at 1.1261. Next key support for the euro is seen around the 1.11 mark.

Having climbed to 125.45 against the yen at 8:30 am ET, the euro pulled back, falling 0.5 percent to a weekly low of 124.80. The pair had closed Tuesday's deals at 125.15. Should the euro continues its downtrend, 122.00 is likely seen as its next support level.

The euro was down 0.3 percent at 1.1254 against the Swiss franc, following near a 3-week high of 1.1285 touched at 6:00 am ET. The euro was trading at 1.1260 a franc at Tuesday's New York session close. Further downtrend is likely to see the euro seeking support around the 1.09 level.

The European currency depreciated to a 2-day low of 0.8593 against the pound, recording a 0.5 percent drop from a high of 0.8634 seen at 5:15 pm ET. The euro was worth 0.8626 per pound at yesterday's close. The euro is poised to find support around the 0.84 level.

Data from the Office For National Statistics showed that the UK economy expanded for the second straight month, but at a slower pace.

Gross domestic product grew 0.2 percent month-on-month in February, while the economy expanded 0.5 percent in January. Economists were looking for growth to remain flat in February.

The euro fell to an 8-day low of 1.5736 against the aussie, reversing from a 2-day high of 1.5835 hit at 11:00 pm ET. The euro-aussie pair was worth 1.5808 at yesterday's close. Continuation of the euro's weakness may see it testing support around the 1.55 level.

The single currency was 0.4 percent lower at a 2-day low of 1.6650 against the kiwi, pulling back from a high of 1.6715 set at 8:15 am ET. The pair had ended trading at 1.6696 on Tuesday. The euro is seen finding support around the 1.64 mark.

The euro was notably weaker at 1.4991 against the loonie, after having risen to a 2-day high of 1.5045 at 8:30 am ET. The euro-loonie pair was quoted at 1.5010 when it finished trading on Tuesday. The euro is likely to challenge support around the 1.475 level, if it weakens again.

Looking ahead, U.S. monthly budget statement for March, as well as the Fed minutes from the March meeting are set for release in the New York session.

At 11:50 am ET, Federal Reserve Governor Randal Quarles will give a speech about the progress on the transition to risk-free rates at the Financial Stability Board Roundtable in Washington DC.


The material has been provided by InstaForex Company - www.instaforex.com

Fatal error: Uncaught Exception: 12: REST API is deprecated for versions v2.1 and higher (12) thrown in /var/www/forex-winner.com/htdocs/wp-content/plugins/seo-facebook-comments/facebook/base_facebook.php on line 1039