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The European Central Bank is unlikely to change its policy but its tone will make a difference. What does this mean for EUR/USD?

Here is their view, courtesy of eFXdata:

Barclays  Research discusses its expectations for the EUR around the ECB March policy meeting on Thursday.  Barclays maintains a tactical bearish EUR/USD bias, expressing that via holding a short EUR/USD position* targeting a move towards 1.0889.

We expect the ECB to keep policy setting unchanged but retain a decisively dovish tone at its March meeting.  We expect the Bank to downgrade its 2019 1.7% growth forecast (by -0.2/0.3pp) and possibly headline and core inflation (by -0.1pp). Against this disappointing macro background, we believe that ECB will maintain the current level of monetary policy accommodation by delivering another TLTRO announcement between March and June,” Barclays projects.

“We remain short EURUSD spot,” Barclays adds.

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