EUR/USD jumped 1.5%. ECB cut rates to zero.

EUR/USD jumped sharply during European session after ECB announced its decision to cut interest rates to zero. As of 12:00 AM EST the pair was trading at 1.1163, which is 1.50% higher than the previous close.

Today the ECB chief Mario Draghi announced a surprise decision to cut interest rates from 0.5% to 0 and expand its money-printing program. Draghi note that the rates would stay low, however it is unlikely that they will cut it further.

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“From today’s perspective and taking into account the support of our measures to growth and inflation, we don’t anticipate that it will be necessary to reduce rates further. Of course, new facts can change the situation and the outlook” said Draghi.

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“The European Central Bank announced a broad attack on below-target inflation, using all monetary policy tools at once to boost the economy and increase inflation,” said Tomas Holinka from Moody’s Analytics.

European shares dropped today. Below is mentioned the performance of major indices:

  • FTSE 100 declined 1.78% closing at 6,036.70.
  • CAC 40 finished at 4,350.35, down 1.70%.
  • Euro Stoxx 50 was trading at 2,970.78, which is 1.51% lower than the previous close.

The oil prices were trading a bit lower than the previous close throughout the day until they sharply dropped during European hours. As of 11:38 AM EST the WTI Crude was trading at 37.31 USD/bbl down 2.56% and Brent Crude at 39.83 USD/bbl, which represents a 3.02% decrease from the yesterday closing price.

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I’m a finance specialist with 4+ years of working experience, out of which 2 years as a SME relationship manager at Byblos Bank and 2 years as a Finance Director in a Food & Beverage sector. My academic background include BA in economics, MA in finance, CFA Level 1 and F1, F2, F3 level of ACCA. I’m also experienced in Forex/CFD trading and Forex/ Equity markets analysis.

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