The ECB left its QE plan unchanged and only said it may increase them. EUR/USD has significant room to fall, especially if spreads continue widening, FXStreet’s analyst Yohay Elam reports.
Key quotes
“The ECB has disappointed investors and the euro may suffer as the PEPP bond-buying scheme has been left unchanged at €750 billion and only said it is ready to increase it and let it run through the year-end. That is insufficient amid the rapid pace of deploying funds and the gravity of the situation, as data has shown.”
“The verdict in debt markets is swift – the spread between Italian and German bonds is rising as investors are disappointed.”
“Growing funding pressures by hard-hit countries may exacerbate the falls in EUR/USD. Targets include 1.0850, 1.0810, and 1.0770.”
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