EUR Edges Up Ahead of ECB Press Conference

EUR edges up in anticipation of the ECB Press Conference scheduled today at 12:30pm GMT and ECB President Mario Draghi’s speech at 11:45am GMT expected to announce more tapering monetary policy measures.

Starting the day at 1.18249, the EUR upward movement has been supported by a lower than expected Treasury yield, which in turn, contributed to a weaker USD. Investors are keeping their eyes peeled on the news awaiting the big ECB Q3 programme announcement. The EUR may experience certain spikes today because of it.

EURUSD hit fresh highs, going up above 1.18236, rallying to regain the 50-DMA position located at 1.17445 ahead of the ECB policy decision.

Investors need to be mindful though that the pair continues to remain underpinned by the prevailing positive sentiment revolving around the EUR as the markets anticipate that the ECB will announce a reduction of EUR25-30 billion monthly of its bond-buying programme, which represents a significant decrease compared to the current EUR60 billlion purchase spending per month.

The ECB Q3 expected tapering announcement is very likely to overshadow the Catalonian turmoil and the uncertainty characterising the political situation in Spain right now.

La Vanguardia, a Spanish daily publication, reported earlier this week that the Spanish government would allow the President of Catalonia, Carles Puigdemont to speak on Thursday.

Additionally, the EURUSD pair is likely to get some fresh impetus from the upcoming German Gfk consumer index and the Spanish employment data release.

Across the Atlantic, the USD is likely to be moved by the unemployment claims release due later today. The numbers reported on October 19 were 222k, below the expected 240k and significantly lower than the previous 244k.

The dollar dropped approximately 0.2% against the JPY, dipping to 113.629 this morning.