The euro fell again, after the temporary rise of the ECB

LAST UPDATE: 17:24

The upward movement of the euro immediately after the announcement of the European Central Bank that it ends the bond purchase program at the beginning of the third quarter, while announcing the first interest rate increase after more than 10 years next month, did not last long, as the public currency has lost its gains and is now moving down again.

In particular, at this time (17:24) the euro is slipping by 0.55% against the dollar with its exchange rate reaching 1.0655 against the US currency.

At the same time, the common currency fell against the British pound by 0.40% and stood at 0.8508.

The volatility is due to the fact that traders deciphering the ECB announcement and subsequent statements by central bank chief Christine Lagarde seem to conclude that the ECB “sounded” more aggressive than expected.

Analysts say the ECB’s announcement demonstrates its efforts to catch up with the other major banks that have stepped up monetary policy by raising interest rates.

“It’s a more aggressive turn, what was announced is not just one or two interest rate hikes, it was a clear signal that they need to raise interest rates much higher in the coming quarters,” said Marchel Alexandrovich, an economist at Saltmarsh Economics.

“She (ECB President Christine Lagarde) is talking about a gradual increase, but in reality she is not very supportive of that – the forecasts speak for themselves and suggest a series of increases,” he added.

The Board The ECB announced the end of the bond market at the beginning of the third quarter on July 1, while at the same time noting that it plans to increase its key interest rates by 25 basis points at the next monetary policy meeting in July.

In the meantime, the Board decided that the interest rate on the main refinancing operations as well as the interest rates on the marginal lending facility and the deposit facility would remain unchanged at 0.00%, 0.25% and -0.50% respectively.

The Board The ECB also notes that key interest rates are expected to rise again in September, leaving open the possibility of a larger September increase, noting that the size of this increase “will depend on the latest medium-term inflation outlook. If inflation prospects persist or deteriorate, a larger increase will be indicated at the September meeting. ”