Draghi remained with his rhetoric

The euro strengthened its position before the speech of the president of the European Central Bank, but then resumed its decline as investors and traders did not receive the necessary, concrete guidance related to the further policy of the European regulator.

In the morning, data came out that showed that consumer confidence in Germany in August of this year will weaken slightly.

According to the report of the research group GfK, the leading index of consumer confidence in Germany in August 2018 was 10.6 points against 10.7 points in July. The data fully coincided with the forecasts of economists. The GfK report also points out that the outlook for consumption remains positive.

Similar data for France were worse than forecasts. According to the report of the statistics agency Insee, the index of consumer confidence in France in July this year compared with June did not change, and remained at the level of 97 points, which is below the long-term average of 100 points. Analysts predicted that in July the index will be 99 points.

As expected, the European Central Bank left the refinancing rate unchanged at the level of 0.0%, which fully coincided with the forecasts of economists. The European Central Bank also left the deposit rate at -0.40%.

analytics5b59ca69dfb72.png

Statements made by the ECB did not cause a reaction in the market.

The ECB confirmed that rates will remain at current levels, at least until the end of the summer of 2019. Net asset purchases of 30 billion euros per month will be made before the end of September 2018. And from October, net asset purchases will be made at a volume of 15 billion euros per month until the end of December 2018. The program will end in late December this year.

ECB President Mario Draghi's speech began with the announcement that he had a significant incentive, which is still necessary to maintain inflation and also the need to adjust all his instruments, if necessary.

Draghi also noted that economic growth will remain strong and large-scale, as the data indicate economic recovery in accordance with the forecasts of the ECB economists.

The president of the central bank pointed to the growth of the harmonized consumer price index in June this year, which reflects the increase in energy prices, while overall inflation will stay at the current level until the end of the year.

Draghi once again confirmed that interest rates will remain at current levels, at least until the end of the summer of 2019, as the exchange rate is not the goal of the ECB policy.

The material has been provided by InstaForex Company - www.instaforex.com