The euro resumed its ascent against all G10 currencies last week, one week after the interest rate cut by the European Central Bank (ECB) and in addition to the EUR/USD returning to 1.346. With these performances in mind, the dovish comments from top ECB official Peter Praet last Tuesday were deemed apt. He suggested that – if inflation continues to weaken – the central bank is likely to set a negative rate for its deposit facility and/or buy bank assets to reduce the cost of borrowing in the private sector.
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