The euro is losing nearly 0.5% against the dollar following the remarks of a member of the Governing Council of the European Central Bank (ECB).
According to Yannis Stournaras, given the current level of uncertainty, "the ECB's next moves should be gradual and at a steady pace." While the statement itself does not deviate from the classic, data-driven messaging of the ECB, the banker's comments on the price dynamics in the eurozone come across as rather dovish. The inflation rate remaining below the 2% target in the medium term provides "significant room" for further easing of monetary policy, and "larger rate cuts should not be ruled out", Stournaras emphasized.
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Create account Try a demo Download mobile app Download mobile appThe ECB had already suggested a less restrictive monetary policy during the press conference on December 12, when President Lagarde highlighted that the weakening EU economy opens the door to further rate cuts. However, up until now, the Governing Council has been rather reluctant to discuss aggressive cuts of 50 basis points, which justifies the downward pressure on EURUSD following Stournaras' remarks.
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