The ECB left its benchmark interest rate unchanged as widely expected and took a wait-and-see approach following last month's decision to expand its pandemic emergency programme by €500 billion and extended it to at least the end of March 2022. Policymakers will keep the current key rates at the current or lower levels until inflation outlook robustly converge to a level sufficiently close to, but below, 2% The pandemic emergency purchase programme (PEPP) will carry on with a total envelope of €1,850 billion and the purchases will be conducted to preserve favourable financing conditions over the pandemic period. ECB will adjust all of its instruments, as appropriate, to ensure that inflation moves towards its aim in a sustained manner. Investors will focus now on ECB President Lagarde comments at the press conference regarding the near-term outlook and risks surrounding the baseline scenario.
EURUSD saw a relatively small reaction to today’s data releases. The most popular currency pair continued to trade around the 1.2150 level. Source: xStation5
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