News & Analysis at your fingertips.

We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site.

0

Notifications

Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events

0

Economic Calendar

Economic Calendar Events

0
Free Trading Guides
EUR/USD
Bearish
Oil - US Crude
Mixed
Wall Street
Mixed
Gold
Bearish
GBP/USD
Bearish
USD/JPY
Bullish
More View more
Real Time News
  • Weakness in equity markets continued last week as losses built and technical patterns hint further bearishness might be ahead. Get your #equities update from @PeterHanksFX here: https://t.co/GGVrB3r7if https://t.co/HPHUC8EG3o
  • Forex liquidity makes it easy for traders to sell and buy currencies without delay, and also creates tight spreads for favorable quotes. Low costs and large scope to various markets make it the most frequently traded market in the world. Learn more here: https://t.co/5uSWKoLkd6 https://t.co/q80wSAoxXP
  • There is a great debate about which type of analysis is better for a trader. Is it better to be a fundamental trader or a technical trader? Find out here: https://t.co/aVAzFypAg1 https://t.co/7mc19Gxrvm
  • #Gold prices succumbed to selling pressure as the US Dollar soared this past week What is #XAUUSD facing these next few days and can these fundamental forces extend its selloff? Check out my outlook here - https://www.dailyfx.com/forex/fundamental/forecast/weekly/chf/2020/09/26/Gold-Price-Outlook-Rising-US-Dollar-Sinks-XAUUSD-Will-Losses-Extend.html?CHID=9&QPID=917702&utm_source=Twitter&utm_medium=Dubrovsky&utm_campaign=twr https://t.co/gPhy0KoW3W
  • GDP (Gross Domestic Product) economic data is deemed highly significant in the forex market. GDP figures are used as an indicator by fundamentalists to gauge the overall health and potential growth of a country. Learn use GDP data to your advantage here: https://t.co/38gTDnpPbn https://t.co/Xtk5g4JQEB
  • Many people are attracted to forex trading due to the amount of leverage that brokers provide. Leverage allows traders to gain more exposure in financial markets than what they are required to pay for. Learn about FX leverage here: https://t.co/3Wked6GBOp https://t.co/SsUguHB39W
  • Key levels in forex tend to draw attention to traders in the market. These are psychological prices which tie into the human psyche and way of thinking. Learn about psychological levels here:https://t.co/1oygcFMFNs https://t.co/aD1ZWhTWZp
  • The price of #oil may continue to trade in a narrow range as the rebound from the September low ($36.13) appears to have stalled ahead of the month high ($43.43). Get your #commodities update from @DavidJSong here: https://t.co/719LgjFmYG https://t.co/SSoqjONUzA
  • The Australian Dollar may extend its slide lower despite the planned easing of Covid-19 restrictions, as the market continues to price in an RBA rate cut on October 6. Get your #currencies update from @DanielGMoss here: https://t.co/HJpngnerzY https://t.co/g6X8ABQDwY
  • The Indian Rupee may be at risk to the US Dollar as USD/INR attempts to refocus to the upside. This is as the Nifty 50, India’s benchmark stock index, could fall further. Get your USD/INR market update here:https://t.co/ed4QR7QQOn https://t.co/gDWYNtm2UY
EUR/USD Rate Drops after Christine Lagarde Nominated Next ECB President

EUR/USD Rate Drops after Christine Lagarde Nominated Next ECB President

2019-07-02 17:55:00
Christopher Vecchio, CFA, Senior Strategist
Share:

EU Leadership Talking Points:

  • International Monetary Fund Managing Director and Chairwoman Christine Lagarde has been tapped to replace Mario Draghi as the next president of the European Central Bank.
  • The IMF chief has been a prominent supporter of accommodative policy to help the Eurozone recover from the Global Financial Crisis and ensuing Eurozone Debt Crisis.
  • The Euro pulled back across the board as traders speculated that a Lagarde-run ECB will be committed to the Draghi-era policy of ultra-low interest rates.

Looking for longer-term forecasts on the US Dollar? Check out the DailyFX Trading Guides.

After months of uncertainty, clarity has emerged regarding the next European Central Bank president. With German Chancellor Angela Merkel able to use her waning political capital to nominate German Defense Minister Ursula von der Leyen to become the next president of the European Commission, the Eurozone’s second largest economy, France, was able to place one of its own among the next class of EU leaders – and in turn, perhaps securing the most important job in all of Europe: the presidency of the ECB.

The Next ECB President is...Christine Lagarde

Former French Finance Minister and current International Monetary Fund Managing Director and Chairwoman Christine Lagarde has been tapped to replace Mario Draghi as the next ECB president. The move comes as a complete surprise to market participants, who up until the past few days did not have Lagarde on their radar as a top contender to succeed Draghi as the next ECB president.

How Will Lagarde Impact ECB Policy?

Even though the nomination does not guarantee ascension, all signs point to Christine Lagarde being confirmed as the next ECB president. In recent months, in her capacity as IMF Managing Director and Chairwoman, Lagarde slashed the IMF’s global growth forecasts, describing the situation as a “delicate moment” the global economy. One can read between the lines and see that she was talking about the collateral damage of the US-China trade war.

To this end, with Eurozone growth flagging and inflation expectations sagging, it would appear that Lagarde will be primed to take the reins from Draghi and continue the accommodative policies of ultra-low rates and asset purchases if necessary (Draghi has talked up the possibility of more stimulus in recent weeks). Decrying the lack of fiscal reform over the past several years, Lagarde is very familiar with the need for the ECB to remain active on the stimulus front. Accordingly, any hopes that the next ECB president would end the era of accommodative policies (i.e. a Jens Weidmann-type) have been dashed.

EURUSD Technical Analysis: 1-minute Price Chart (July 2, 2019 Intraday) (Chart 1)

eurusd price forecast, eurusd technical analysis, eurusd price chart, eurusd chart, eurusd price

Amid the flurry of nominations for the next class of EU leaders, the Euro pulled back quickly from its daily highs. EUR/USD dropped from 1.1312 to as low as 1.1292 over a 15-minute period, before rebounding back to 1.1301 at the time this report was written. Elsewhere, with US equity markets under pressure and US Treasury yields falling, the Japanese Yen was able to take advantage of the shift in news f;ow, with EUR/JPY sliding to its lowest levels of the day following the reports.

FX TRADING RESOURCES

Whether you are a new or experienced trader, DailyFX has multiple resources available to help you: an indicator for monitoring trader sentiment; quarterly trading forecasts; analytical and educational webinars held daily; trading guides to help you improve trading performance, and even one for those who are new to FX trading.

--- Written by Christopher Vecchio, CFA, Senior Currency Strategist

To contact Christopher Vecchio, e-mail at cvecchio@dailyfx.com

Follow him on Twitter at @CVecchioFX

View our long-term forecasts with the DailyFX Trading Guides

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES