EUR and GBP: the ECB left the policy unchanged, while data on the UK economy temporarily supported the pound
The European currency has ignored the ECB's decision to leave rates unchanged and even slightly strengthened in pair with the US dollar, but much will envy of what ECB President Mario Draghi will talk about during his speech.
According to the data, today the European Central Bank has left the refinancing rate unchanged at the level of 0.0%. The deposit rate was also kept at the same negative level of -0.40%.
The regulator said that the rates will remain at current levels at least until the end of 2019, while many experts expected a change in the rate in the fall at the beginning of the year. The ECB also noted that it will fully reinvest the profits from quantitative easing for a long period after the first rate hike.
Today in the first half of the day, data were also published, according to which industrial production in France in February of this year showed an increase of 0.4% compared with January. Economists had expected industrial production in France to drop by 0.5% in February. The data for January was revised down slightly to 1.2% versus 1.3% earlier.
As for the technical picture of the EURUSD pair, it remained unchanged. Pressure on the euro may return after the speech of the President of the European Central Bank, Mario Draghi. The breakthrough of important support levels around 1.1250 and 1.1220 will resume the downward trend in risky assets, which will lead to the renewal of already monthly lows around 1.1180 and 1.1120. In case of going beyond the resistance level of 1.1290, the demand for the euro will lead to the renewal of local highs in the area of 1.1320 and 1.1380.
The British pound rose in the first half of the day amid good data on economic growth, as well as due to a decrease in the probability of a hard Brexit. Most experts agree that the UK will almost certainly get another postponement following the meeting, which will be held this Friday. On the other hand, what kind of postponement is still unknown. If London receives an annual delay with the right to leave the EU ahead of schedule, it will weaken the position of British Prime Minister Theresa May, which will threaten her political career. This will be a negative signal for the British pound, as the uncertainty associated with the prospects for economic growth will only increase.
On the other hand, if the EU votes for the postponement until June 30, as the Prime Minister requested, the chances of developing the agreement necessary for parliament will remain quite high, which will be a positive signal for pound buyers.
As for today's report, despite the slow growth, good rates of activity in the service sector remain and a recovery in demand for goods produced in the UK is noted. According to the National Bureau of Statistics, between December and February 2019, UK GDP grew by 0.3%, showing a similar increase in the period from November to January.The material has been provided by InstaForex Company - www.instaforex.com