By: DailyForex.com
As FX investors await the latest policy announcement from the European Central Bank, expectations continue to grow. Most traders now believe that Mario Draghi and the other decision makers will provide some form of additional stimulus in order to get the Eurozone economy back on track. Analysts believe that the ECB will likely increase its quantitative easing efforts with additional bond purchases or else drop rates even further. As a result, the common currency fell by nearly 0.50% in early trading.
As reported at 10:43 am (GMT) in London, the EUR/USD was trading at $1.0958, down 0.38%; the pair earlier hit a low of $1.0944 while the day’s high was at $1.0998. The EUR/JPY is also lower at 124.2825 Yen, down 0.78%, near the low end of today’s trading range at 124.2540 Yen while the top end held at 125.2305 Yen.
Outlook Shaky for Kiwi and Loonie
The ECB is not the only bank with a policy decision this week. Traders are also going to be waiting for the outcome of the Reserve Bank of New Zealand and the Bank of Canada, both of which come out on Wednesday. Currently, expectations are that the existing monetary policy will continue for the short term, however the outlook is uncertain. Analysts note that the slump in commodity prices, especially in oil, is having a detrimental impact on their respective economies. As a result, in the longer term, both central banks could push through additional measures that would weigh on the Loonie and Kiwi. The USD/CAD was higher at C$1.3367, a gain of 0.24% while the NZD/USD was down 0.96% at $0.6754.