Live Coverage: ECB set to cut rates, may convey dovish message and shake EUR/USD

Yohay Elam FXStreet

The ECB is set to cut rates for the second time in this cycle, but uncertainty looms about future moves as the global economy slows. Live coverage of the critical September 2024 ECB decision.

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ECB doves may come out as inflation hits target, Germany slows

Volkswagen is considering closing factories in its home country of Germany for the first time in its history. The Federal Reserve is about to kick off a consistent cutting cycle. And most importantly, the eurozone's inflation rate has fallen to 2%, the European Central Bank's target.

All these are good reasons for the Frankfurt-based institution to cut rates by 25 bps, a move widely telegraphed. These factors may also push ECB President Christine Lagarde to opt for a dovish message of further rate cuts.

EUR/USD is set to rock in response to the decision, the press conference, and the ECB's new forecasts for growth and inflation. Apart from the world's No. 1 currency pair, other assets such as the DAX, eurozone bonds and even Gold.

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(This story was corrected on June 6 at 07:45 GMT to say that the European Central Bank is set to cut interest rates for the first time since 2019, not 2020.)

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Author

Yohay Elam

FXStreet

Yohay is in Forex since 2008 when he founded Forex Crunch, a blog crafted in his free time that turned into a fully-fledged currency website later sold to Finixio.

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