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ECB To Join Rate Hike Club

ECB To Join Rate Hike Club

Today, all eyes will be on the ECB meeting. The central bank is expected to hike rates by a minimum of 25bps, having provided clear guidance at its previous policy meeting that it would do so.

Heading into the watermark decision, which will bring an end to negative interest rates in the Eurozone, the single currency is up this morning against both the Pound and US Dollar. Further gains have also been attributed to the easing fears of a complete shut off in Russian gas supplies with Nordstream1 opening back up operations after closing down for 10 days for maintenance reasons. 

As trading gets underway this morning, the slightly firmer tone to the euro sees EUR/USD open back above 1.02. GBP/EUR remains on the defensive and opens circa 1.17 with Cable (GBP/USD) operating in the lower half of the 1.19-1.1950 corridor. 

Datawise, the main headline reading is the ECB’s monetary policy meeting, the docket is otherwise very light so markets will be focusing on not only the reading but also the press conference which follows and the tone taken by ECB President Christine Lagarde.

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