ECB Bulletin Analysis

Release Explanation: It reveals the statistical data that the ECB Governing Board evaluated when making the latest interest rate decision. The report also provides detailed analysis of inflation and current economic conditions.

TheLFB-Forex.com Trade Desk Thoughts: The ECB releases the data that backs the bank's decision to cut the interest rate to 1.00%, one week ago. Usually, the market has a weak response to this release, since the data that makes up the bulletin has already been released.

The ECB acknowledged that inflation pressures had further diminished in the last few moths, and now the Governing Council expects some very low CPI rates during the second part of the year. However, according to the bank's assessment, this trend should reverse by early 2010.

In addition, the outlook for the economic activity clearly lies on the downside now. Both foreign and internal demands are very weak, affecting the Euro-area's export market, and thus its trade balance. This trend is seen worldwide, and not only in Europe.

Forex Technical Reaction: The euro rose 50 pips since the new trading day started. Currently, the pair is struggling to break above the high reached on Wednesday.

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