The ECB didn’t change the rate and the Euro didn’t change direction. Overview for 17.07.2020

Yesterday, market players were waiting for more decisive actions from the European Central Bank to help Europe to recover from the crisis. However, at the end of the meeting, the European regulator didn’t change anything and said that it was ready to adjust its policy, if necessary, to help the region’s inflation reach its target. 

The deposit facility rate remained at -0.5%, the interest rate at 0%, and the marginal lending rate at 0.25%.

In addition to that, the ECB kept the PEPP intact at €1.35T.

“The Governing Council will continue its purchases under the pandemic emergency purchase program (PEPP) with a total envelope of €1,350 billion. These purchases contribute to easing the overall monetary policy stance, thereby helping to offset the pandemic-related downward shift in the projected path of inflation.” – a quotation from the ECB comments. 

The regulator once again noted that “its Governing Council expects the key ECB interest rates to remain at their present or lower levels until it has seen the inflation outlook robustly converge to a level sufficiently close to, but below, 2% within its projection horizon.”

At first, EURUSD responded to such news by growing and reaching 1.1440 but after “digesting” the news, market players started massive sales of the instrument, which is now expected to fall towards 1.13.