EUR: Draghi strikes a dovish tone and leaves a decision until October

Yesterday the European Central Bank announced that they would not be making any changes to their current monetary policy. It is difficult to say whether this is a surprise or not because, while ECB President Mario Draghi does have previous for going against expectations, the truth is that analysts were pretty divided on what they thought would be said.

Draghi did say that the bulk of decisions regarding quantitative easing tapering would be made in October, but that interest rates will remain at present levels long after QE finishes. The markets responded by pushing the euro above US$1.20 as Draghi spoke. In truth it was slightly underwhelming – the vast majority of what the financial world was waiting to hear has been delayed until October 2017. Still, it’s not all that far away.

Today sees the release of the German import and export data and French industrial production data. Otherwise it’s a pretty quiet day and it will be interesting to see whether the euro can make further gains against the dollar or whether it was purely a result of what Draghi said at the time he said it.