The euro may see a slight uptick if the European Central Bank takes a cautious stance on rate cuts during Thursday’s meeting, according to a note from Bank of America analysts.
“The market is already pricing two cuts for the next two meetings, and the ECB is unlikely to commit to more cuts beyond that right now,” they note.
This measured approach could offer some modest support to the euro, given the presence of short positions betting against the currency. However, BofA remains cautious on the euro in the near term, citing the risk of potential U.S. trade tariffs, which could strengthen the case for further ECB rate cuts.
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The European Central Bank announcement, followed by European Central Bank President Lagarde’s press conference, is on Thursday, January 30, 2025:
This article was written by Eamonn Sheridan at www.forexlive.com. Source