The ECB left monetary policy unchanged during its July meeting. Interest rates were kept at record-low levels and the PEPP quota was maintained at €1.85 trillion. Interest rates have been close to their lower bound for some time and medium-term outlook for inflation is still well below ECB's target. As such, ECB has revised forward guidance on rates to underline commitment to maintain accommodative monetary policy stance. Expects rates to remain at their present or lower levels until it sees inflation reaching 2% well ahead of the end of its projection horizon. This may also imply a transitory period in which inflation is moderately above target.
Investors will focus now on ECB President Lagarde comments at the press conference regarding the economic outlook, inflation and fiscal stimulus.
EURUSD broke above the 1.1800 resistanceafter today's ECB decision and is currently testing 200 SMA (red line). Should break higher occur, upward move may accelerate towards next resistance at 1.1825. Source:xStation5