FX News – July 4: BoE & ECB Interest Rate Decisions Up Today

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Both the ECB and the BoE are set to announce their respective interest rate decisions today. So far, however, the EUR/USD pair has moved little during the past few days, just hovering at around the 1.3000-1.3200 levels. All eyes will be on Mr Draghi's statement, so expect volatility in the coming hours. Although the ECB is not expected to make any changes to the interest rate, traders would closely follow the ECB president's statement. A positive one could help boost the euro, while a negative statement could drive it lower.

The EUR/USD pair is currently trading at 1.3000, with initial resistance seen at 1.3077, followed by 1.3110. Meanwhile, initial support is seen at 1.2966, followed by 1.2934.

While the statement from the ECB is sure to create a ripple effect in the market, there is even keener attention on the BoE's interest rate decision. This is primarily due to the fact that the meeting will be the first one to be attended by the new BoE governor Mark Carney. Aside from that, however, the BoE is not also expected to announce any drastic change in the interest rate. After all, the UK's inflation rate is on the rise and there have been positive signs of growth in the country's economy.

Currently, the GBP/USD pair is trading at 1.5245. It slid slowly over the past few hours from yesterday's high at around the 1.5300 level. Initial resistance for the pair is at 1.5381, followed by 1.5419. Meanwhile, initial support is at 1.5205, followed by 1.5167.

While the US market is closed today for its Independence Day celebration, there is much anticipation for its Nonfarm Payrolls (NFP) data that will be announced tomorrow. Aside from the NFP, the US will also announce its unemployment rate figure, which is expected to drop slightly from 7.6% to 7.5%.

By FX Strategy Team, Published on 4th of July 2013
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