Will we sit back and watch how the euro reacts following the ECB’s interest rate announcement?

Will we sit back and watch how the euro reacts following the ECB’s interest rate announcement?

27.07.2023

In the previous day’s U.S. currency trading, the FOMC raised rates by 0.25% as expected by the market; although it did not signal an end to rate hikes at the next meeting in September, the U.S. dollar fell against the euro.The EUR/USD pair rose from 1.1037 to 1.1070. Although it had been trading below the 4-hour 20-MA, yesterday’s rally pushed it above that level. The RSI on the 4-hour chart has also risen from below 30 and is currently hovering around 51, so we will be watching for further gains during European trading hours.

Ahead of today’s ECB policy rate announcement, the euro is falling against the yen. The EUR/JPY pair has dropped from 155.990 to 155.145. It continued to decline during today’s Asian trading session, touching 154.873. While a 0.25% rate hike is expected at today’s ECB meeting, we will be closely monitoring the direction of the EUR/JPY pair to see if the euro will rise if the outcome matches expectations.

Today’s schedule includes the German GfK Consumer Confidence Survey at 3:00 PM, the UK CBI Retail Trade Survey at 7:00 PM, the ECB policy rate decision and statement at 9:15 PM, U.S. initial jobless claims, U.S. second-quarter GDP, U.S. durable goods orders, and U.S. wholesale inventories at 9:30 PM,at 9:45 PM, the ECB President Lagarde’s press conference; at 11:00 PM, U.S. pending home sales; at 11:30 PM, U.S. weekly natural gas inventories; at 12:00 AM, the U.S. Kansas City Fed Manufacturing Activity Index; and at 2:00 AM, the U.S. 7-year Treasury auction. I intend to closely monitor the euro’s price movements following the ECB’s policy rate announcement.

Past Market Reports

1. 21.04.2026New

   With the euro-Australian dollar pair hitting new lows this month, attention is turning to how much further it might fall

2. 20.04.2026New

   Will the market wait and see how much further the U.S. dollar can rise against the yen?

3. 17.04.2026New

   Will the weakening Swiss franc recover? Attention is turning to price movements during European trading hours.

4. 16.04.2026New

   Market participants are likely keeping a close eye on the upside potential of the euro, which has risen against the U.S. dollar

5. 15.04.2026New

   Should we keep an eye on remarks by key figures in the U.S. and try to gauge the direction of currency strength?

6. 14.04.2026

   Market participants are likely watching for signs of a rebound in the Canadian dollar, which fell against the U.S. dollar following the release of employment figures

7. 13.04.2026

   Will the weakening Swiss franc continue to strengthen against the yen, or should we wait and see?

8. 10.04.2026

   Will the U.S. dollar, which has fallen against the yen, continue its downward slide, or should we wait and see how the market moves?

9. 09.04.2026

   Should we keep an eye on the upside for European currencies that have risen against the U.S. dollar?

10. 08.04.2026

    Market participants may be wary of further downside potential for the U.S. dollar, which has weakened amid concerns over the situation in Iran