Published on 17.03.2023 14:51

The Euro continues to push higher against the US dollar in today’s trading session, after yesterday’s rate hike from the ECB as well as measures from the Swiss Central Bank to restore order in the country’s financial sector.

The central bank has offered up to 50bn francs as needed to restore stability to Credit Suisse, a European banking giant, whose shares had plunged as much as 30% on Wednesday which caused the Euro to tumble by around 200 points.

In yesterday’s session, the European Central Bank raised interest rates as planned despite market chaos in recent days which was followed up by a bullish statement where the ECB pledged to do whatever it takes to bring inflation down to the target rate of 2 percent.

“Inflation is projected to remain too high for too long. Therefore, the Governing Council today decided to increase the three key ECB interest rates by 50 basis points,” the ECB said in a statement.

“The Governing Council is monitoring current market tensions closely and stands ready to respond as necessary to preserve price stability and financial stability in the euro area. The euro area banking sector is resilient, with strong capital and liquidity positions,” they added.

The US Federal reserve is also on track to raise interest rates again next week with markets pricing in a more than an 80 percent chance that the Fed will lift rates by a quarter point on March 22 which is already priced into the markets.

As we enter the American trading session, the Euro has received a further boost after the release of the Michigan consumer sediment index which hit the market at 63.4 against analysts’ expectations for a figure of .67.

 The Fed have constantly stated that any further rate hikes will be data dependant so this latest round of disappointing data may give them something to think about before next weeks expected rate hike.