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Draghi didn't announce any new monetary measures

Thursday, Sep 08 2016

Mario Draghi in his press conference stressed the downside risks to growth forecasts. The central bank sees the economy growing at steady pace and inflation moving upward over the course of the next couple of years. Draghi used rhetoric, but the market is concerned about recent downgrades to German economic growth and the lack of bonds to purchase to stimulate prices. During the question and answer session of the press conference, Draghi was asked about other instruments that could be used as part of the quantitative easing program.  One of the issue the ECB is facing is that their stringent bond purchase program is making it very difficult for the central bank to find bonds that are eligible for purchase. 

The ECB didn't discuss additional measures or QE extension. Draghi stressed in response to a question that the council didn't discuss either additional action or a further extension of the asset purchase program.  He actually stated that the committees are tasked at ensuring efficient implementation of current measures and not evaluating future measures. Draghi commented that the current forecasts do not warrant monetary policy action at the moment.

 

Euro is curently being traded around 1.13 handle. Pair is likely to find support around 1.12 area and resistance above 1.1380 level.

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