ECB Minimum Bid Rate Decision 09/03/09

7:45am (NY Time) EU ECB Rate Decision  Forecast 1.00%  Previous 1.00%
ACTION: EUR/USD       N/A

ECB (European Central Bank) will probably leave rates at an unchanged level of 1.00%.  It is very unlikely for ECB to surprise the market and cut or hike current rate by 0.25%.  As numerous of ECB officials stated recently that the current rate is appropriate, the expectation for ECB rates among analysts is pretty much neutral.  Furthermore ECB is concerned over the imbalanced economic recovery over its member countries, therefore there would be no justification for a rate hike; and God forbids should ECB cut the current rate and send the world a message that ECB has been incompetent and clearly behind the curve and needs a rate cut at this late stage in order to somehow stimulate their economies…  

And of course, based on past track records, ECB is not in the habit to surprise the market, therefore not much market reactions usually follow this release.

The important event will be the press conference at 8:30am, or 45 minutes after this release.  ECB Chairman Trichet will deliver a written statement and then host a lengthy Q&A session.  Market is more likely to be volatile during the press conference than the actual rate decision, as Trichet sometimes may drop hints on future ECB monetary policy direction; therefore, I’d pretty much skip this news and just pay attention to the press conference itself.

[flv:http://www.newsprofiteer.com/090309-ecbrate/090309-ecbrate.mp4 480 360]

UPDATE: Rate decision came out as expected at 1.00%, therefore it was a NO TRADE.  I stayed out of the market and protected my account.

Related posts:

1. ECB Minimum Bid Rate Decision 10/08/09
2. ECB Minimum Bid Rate Decision 11/05/09
3. ECB Minimum Bid Rate Decision (Interest rate decision) 12/03/09
4. Forex News Trading EU ECB Interest Rate Decision 05/05/11
5. ECB Trichet Press Conference 09/03/09
6. ECB Trichet Press Conference 11/05/09
7. ECB Trichet Press Conference 10/08/09
8. ECB Trichet Press Conference 08/06/09
9. ECB Trichet Press Conference 12/03/09
10. RBA Cash Rate Decision 11/02/09

Tagged as: Chairman Trichet, current rate, ECB, economic recovery, Forecast, hike, Inflation, Interest rate, Key Interest rate, Minimum Bid Rate, monetary policy, rate hike, Trichet