On Tuesday (Oct 25), / rose, temporarily trading at 0.9889, up 0.15%.
“The situation is becoming more uncomfortable,” said FranckDixmier, global chief investment officer for Allianz Global Investments fixed income. “Headwinds are making the task more difficult.”
To fulfil its mandate, the ECB must raise as much as possible to bring inflation to a level consistent with its price stability objective, but government support programmes for purchasing power and demand are pushing prices higher.
Nevertheless, the ECB’s stance should remain unchanged that it must continue to act quickly and strongly, Dixmier said.
The European Central Bank is expected to announce a 75 basis point rate rise on Thursday, and such a large increase should not come as a surprise.
The technical readings on the daily EURUSD chart are insufficient to support another northern line.
The momentum indicator is firmly to the south within the negative level, while the RSI indicator remains directionless near 52.
Meanwhile, the 100 and 200 MA have moved steadily lower and well above current levels, while the mildly bullish 20 MA offers support near 0.9780.
