All eyes are on whether the ECB’s policy rate announcement will shift market sentiment

All eyes are on whether the ECB’s policy rate announcement will shift market sentiment

05.06.2025

In yesterday’s U.S. currency trading, the Canadian dollar fell against the yen after the Bank of Canada (BOC) announced that it had kept its policy rate unchanged at 2.75%. The CAD/JPY pair fell from 105.301 to 104.324. It dropped from the +3σ to the -3σ levels on the hourly Bollinger Bands.On the 4-hour chart, the pair is searching for direction within a zone where short- and long-term moving averages converge, while on the daily chart, the RSI is stagnating around 50 just below the 20-day moving average.

European currencies saw the euro rise against the U.S. dollar ahead of today’s ECB policy rate announcement. The euro/dollar pair rose from 1.1357 to 1.1433. It rebounded after touching the 200-period simple moving average (SMA) on the hourly chart. On the 4-hour chart, the price has shifted from below the 20-period moving average (MA) to above it, while on the daily chart, the upward trend along the 20-period MA has continued for about 10 trading days. We will be watching closely to see if the policy rate announcement changes the market’s direction.

Today’s schedule includes Japan’s Monthly Labor Survey at 8:30, Japan’s Foreign and Domestic Securities Investment at 8:50, Australia’s Trade Balance at 10:30, Germany’s Manufacturing Orders at 15:00, the UK’s Construction PMI at 17:30, the Eurozone’s Producer Price Index and South Africa’s Current Account Balance at 18:00,at 8:30 PM: U.S. Challenger Job Cuts, at 9:15 PM: Eurozone ECB Policy Rate and Statement, at 9:30 PM: U.S. Initial Jobless Claims, at 9:45 PM: Eurozone ECB President Lagarde’s remarks, at 11:00 PM: Canada’s Ivey PMI, and at 1:00 AM: U.S. Federal Reserve Governor Kuehler’s remarks.We will be closely monitoring the euro’s price movements to see if the ECB’s policy rate announcement leads to a shift in market sentiment.

Past Market Reports

1. 17.04.2026New

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

2. 16.04.2026New

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

3. 15.04.2026New

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

4. 14.04.2026New

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

5. 13.04.2026New

   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

6. 10.04.2026

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

7. 09.04.2026

   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?

8. 08.04.2026

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

9. 07.04.2026

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

10. 06.04.2026

    Investors should be wary of sudden spikes in volatility while major markets are closed