EUR/USD to wait ECB decision after 4th of July US Holiday

With Greek elections and Spanish banking rescues addressed in the European summit. Analysts are now starting to forecast the probability of a ECB benchmark rate cut on Thursday. European data was weaker which makes the case for a rate cut. Adding to that even the policital winds have changed. Once favouring austerity only measures to solve the crisis, the case has now been made that financial stimulus should be an alternative to restart the Euporean economy.

With the US Fourth of July holiday coming up on Wednesday the market will be waiting for the announcements from the European Central BAnk as well as the Bank of England which is set to make a rate announcement first. The market is already starting to price a rate cut, with saw the EUR lose ground versus the USD before the fourth of July holiday.

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza