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2025-12-15 21:17:35
[ECB Meeting Likely to Remain Unremarkable; Policy Ambiguity Locks in Euro Volatility] ⑴ UniCredit analysts point out that if the European Central Bank (ECB) keeps interest rates unchanged on Thursday, the euro exchange rate is unlikely to fluctuate significantly, especially given ECB President Lagarde's ambiguous stance on future policy. ⑵ They believe Lagarde is likely to continue emphasizing that policy depends on data, without explicitly hinting at the direction of the next interest rate move. ⑶ The market may interpret this as a weakening inclination of the ECB to cut rates, but also a lack of imminent rate hikes, with policy entering a period of stable observation. ⑷ The institution maintains its forecast that interest rates will remain stable for an extended period. ⑸ Given its expectation that the Federal Reserve's rate cut will be smaller than the market's current aggressive pricing, UniCredit believes the euro/dollar exchange rate may struggle to sustain a break above 1.20.
