NNA – The euro hovered today above the 20-year low it hit two days ago, as investors await the European Central Bank’s policy decision and comments from the Federal Reserve Chairman (the US Central Bank) for indications on the path of global monetary tightening.
The European Central Bank is expected to raise interest rates by 75 basis points, bringing the deposit rate above zero for the first time since 2012, but the option of raising interest rates by 50 basis points has not been ruled out.
“We expect the European Central Bank to raise (interest) only 50 basis points today, instead of the consensus view of 75,” said Chris Turner, head of markets at ING Chris Turner.
He added: “If this is the case, we believe that the euro against the dollar may correct its decline to about $ 0.99.”
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