Forex Market Remains Balanced as ECB Rates Unchanged

• ECB Rates Unchanged as Lagarde Speaks
• Dollar Holding Steady Despite Disappointing Data
• Stock Market Also Positive in Early Trading

The forex market has remained neutral in the wake of news breaking today that the ECB will leave interest rates unchanged. This was announced with many traders now waiting to hear from President Lagarde as her press conference gets underway. The Dollar has held its recent strength well with this news despite the fact that US GDP numbers also disappointed the analysts. The GDP miss while felt by many, has so far been shrugged off by those on Wall Street. The early trading has seen more positive numbers as the street tries to cap off an impressive earnings season. 

Interest Rates Unchanged by ECB

The ECB has not relented to any of the recent pressure to increase interest rates. Instead, they have kept all three of their key rates the same at 0%, 0.25%, and -0.5% respectively. The interest rate on the main refinancing operations, marginal lending facility, and deposit facility have all remained unchanged as ECB leader President Christine Lagarde shows her ability to stay firm.

Not only that, but they have also not given up any ground in their PEPP program of support program which will continue at its current rate. The 1.85 Trillion Euro program has come under fire at certain points with some policymakers calling for tighter fiscal control. This has been rebuffed though as the bloc stands behind their position of waiting for inflation to hit the targeted goal. Attention now turns to the press conference being held by Lagarde. 

Disappointing GDP Fails to Rattle Dollar

GDP numbers in the US also failed to inspire the market. Figures from the US Bureau of Economic Analysis showed that the economy of the United States grew by 6.5% in Q2. This was significantly lower than the number which had been expected by forex brokers and analysts alike at 8.5%. In reaction, the US Dollar Index has been trading much lower below the 92 point mark. 

That has not impacted the USD position all that much as it has also been met with weakness on domestic news from both the Euro and GBP. At the time of writing, the EUR/USD was still trading up above the 1.16 level much as it started the day.

Stock Market Shrugs Off GDP Miss

Wall Street too appears to have not been overly influenced by the US GDP miss. Stocks have pushed towards a positive opening and closer to rounding off what has been a bumper week for earnings.

Many of the big names eclipsed expectations with GM smashing targets yesterday. Similarly, Ford has been the big story of the morning with another big beat on what had been predicted, and positive guidance moving forward. All major indices, the Dow Jones, NASDAQ, and S&P 500 are trading near records and all comfortably inside positive territory for the week.