There are mixed signals regarding the EUR today. On one hand, the FOMC announcement could trigger a recovery in the USD, which would likely have a negative impact on the EUR/USD pair. On the other hand, there are positive developments in the European market, specifically in terms of efforts to contain adverse side-effects of the UBS-CS deal, which could boost European sentiment. However, there is also uncertainty around the baseline assessments of inflation and growth, given recent financial market tensions.
Regarding the ECB, President Lagarde expressed concern about the ongoing war in Europe and the high inflation rate, and the ECB has raised interest rates by 50 basis points to ensure the 2% inflation target is met. While growth is predicted to be at 1%, underlying price pressures remain strong, and the bank will continue to monitor market tensions closely and be data-dependent in its policy rate decisions. The next meeting is scheduled for 4 May 2023.
Overall, the EUR may be influenced by a combination of factors, including the FOMC announcement, developments in the European market, and ongoing inflation and growth concerns.