ECB chief economist, Philip Lane, speaks in an interview with the FT
- We could still lower the deposit rate if needed
- The market does not think we are going to raise rates in 2-3 years
- There is room for that through forward guidance
- We need to make sure yield curves don't move ahead of the economy
There isn't much that hasn't already been said through the ECB policy statement last week and via Lagarde's press conference at the time as well.
The ECB is putting a lot of emphasis on "favourable financing conditions" but there is a vague room for what that entails, as they are mostly viewing that in terms of how the bond market is shaping up to be in recent weeks.
Further Development
Analyzing the current trading chart of EUR, I found that the buyers got exhausted today and that there is bearish divergence on the momentum oscillator, which is another sign of weakness.
Key Levels:
Resistance: 1,1950
Support levels: 1,1888 and 1,1840
