In European trading on Tuesday (September 13), EUR/USD rose, temporarily reporting 1.0147, or 0.26%. The European Central Bank recently announced that it will raise the three key interest rates in the euro zone by 75 basis points, which is the largest interest rate increase since the introduction of the real euro currency in 2002. But the decision to raise interest rates did not bring an effective boost to the euro exchange rate.
ECB latest news:
There are three key pieces of information in the announcement issued by the European Central Bank on the same day: First, the European Central Bank has once again significantly raised its inflation forecast in the euro area. The inflation rates for this year and next are expected to reach 8.1% and 5.5% respectively, both far higher than the 2% target; The European Central Bank judges that the economic growth of the euro zone will slow down and may stagnate, and the economic growth next year will drop from 3.1% this year to 0.9%. Third, the European Central Bank believes that the depreciation of the euro will further increase inflation. European Central Bank President Christine Lagarde said on the same day that a rate hike of 75 basis points is not the norm, but if necessary, the European Central Bank will continue to raise interest rates significantly.
EUR/USD technical analysis:
EUR/USD held on to recent gains below 1.0150 during the European morning amid broad dollar weakness and negative U.S. Treasury yields. The pair looks ahead to the most important U.S. inflation data before resuming the recovery. Germany’s ZEW has also noticed this.