The Euro fell more than 2% after comments by the ECB

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The single currency fell on Thursday more than 2% after comments by the ECB at the moment EURUSD is trading at the level of 1.1560 against 1.1810 day ago. It was the sharp drop in the Euro against the dollar since Brexit. The main reason is considered to be an indication that the Central Bank does not intend to raise rates for another year. However, for a number of reasons should also include a more resolute attitude of the fed, announced on Wednesday evening. The proximity of these two events emphasized the contrast of the intentions of the two major world Central Bank, triggering a strong reaction from the market.
At the end of 2014, the fed acted at about the same speed, “promised” rate hike just a year before the actual promotion, but then it caused a sharp rise in the dollar.
Most importantly, what can be learned from meetings of the fed and ECB this week – the largest Central banks confirmed the departure of the crisis measures and is ready to accelerate the transition to normal. It is likely that when the dust settles, most victims will again be the currencies of developing countries.
The Bank of Japan this morning was not able to report such optimism, retaining all the key points of the comment policy unchanged.
Due to the collapse of the Euro on Forex EURRUB lost over the past day, 114 cents, falling to 72.50. Resistance 74, observed last month, reiterated its power. USDRUB increased by 10 cents to 62.63. But it is important to note the growth rate at the end of the day. The pair gained more than 60 cents in the Wake of the reaction to the ECB.
Currencies of major developing countries are losing the last day and continue easing in the morning, forming a negative background for the opening of trading on the ruble. While the single currency may well continue its weakening against the ruble, stepping closer to 72.0, USDRUB will probably try their hand at overcoming 63.0 – resistance area for the last month.
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Alexander Kuptsikevich,
Financial analyst,
FxPro