Traders Eye ECB Move in September

The European Central Bank (ECB) is widely expected to hold interest rates steady on Thursday with many market watchers expecting the bank to announce in September plans to reduce its bond-buying program.

ECB President Mario Draghi’s speech in Sintra was interpreted by many economists as a sign that the central bank was more optimistic about the economy and could start “tapering” earlier than expected. Since his speech in June, the ECB has tried to calm down those expectations in order to prevent an unwanted tightening of monetary conditions.

“Our mission is not yet accomplished. We need patience and persistence. We need to be patient, because inflation convergence needs more time to show through convincingly in the data,” the ECB’s Chief Economist Peter Praet said in a speech July 6 in Paris. In the same speech, he also said that the recovery in the euro zone “seems to have gathered further momentum.”

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Craig Erlam

Craig Erlam

Senior Market Analyst, UK & EMEA at OANDA
Based in London, Craig Erlam joined OANDA in 2015 as a market analyst. With many years of experience as a financial market analyst and trader, he focuses on both fundamental and technical analysis while producing macroeconomic commentary. His views have been published in the Financial Times, Reuters, The Telegraph and the International Business Times, and he also appears as a regular guest commentator on the BBC, Bloomberg TV, FOX Business and SKY News. Craig holds a full membership to the Society of Technical Analysts and is recognised as a Certified Financial Technician by the International Federation of Technical Analysts.
Craig Erlam