Skip to content

We want to clarify that IG International does not have an official Line account at this time. We have not established any official presence on Line messaging platform. Therefore, any accounts claiming to represent IG International on Line are unauthorized and should be considered as fake.
CFDs are complex instruments. 72% of retail client accounts lose money when trading CFDs, with this investment provider. You can lose your money rapidly due to leverage. Please ensure you understand how this product works and whether you can afford to take the high risk of losing money.
CFDs are complex instruments. 72% of retail client accounts lose money when trading CFDs, with this investment provider. You can lose your money rapidly due to leverage. Please ensure you understand how this product works and whether you can afford to take the high risk of losing money.

EUR/USD and EUR/GBP hold their ground ahead of ECB decision while AUD/USD aims to build on recent recovery

The euro is holding firm as markets await the ECB decision, while the Aussie is hoping to continue its recovery against the US dollar.

Video poster image

EUR/USD moving higher ahead of ECB decision

European Central Bank (ECB) day has arrived, and the EUR/USD is attempting to build on yesterday’s bounce against the dollar, which itself has come off support around the $1.08 zone. The next target in the event of further gains would be a move towards the 50-day simple moving average (SMA) at $1.1107, and then on to the peak from early April back towards $1.12.

But at present it might be difficult to envision a particularly hawkish ECB meeting. The uncertainty surrounding the economy, partly thanks to the war in Ukraine, means that it is tough for the ECB to sound too aggressive in its rhetoric. It will likely stick to its view that rate rises will only come after the asset purchase programme is wound down, which is likely to be June or later.

This puts the euro at a disadvantage versus the dollar, where 50 basis points (bps) rate hikes are expected from May.

EUR/USD Source: ProRealTime
EUR/USD Source: ProRealTime

EUR/GBP holds above support

We can expect the EUR/GBP to be in focus today as the ECB meets, and following on from UK data this week which showed that inflation remained strong and employment continued to recover. The steady downtrend that has prevailed for most of the past year has actually stalled in recent months, with the price mostly showing a reluctance to head below £0.83, aside from the sharp dip in early March.

A more hawkish tone from the ECB could be the spark that the pair has been looking for to head higher, with a move above the peak this week of £0.837 providing a more bullish catalyst that could then see the price make headway towards £0.844.

Meanwhile, a break below £0.83 would spark a bearish move that would put the lows from early March at £0.82 back into view.

EUR/GBP Source: ProRealTime
EUR/GBP Source: ProRealTime

AUD/USD looks for further gains

After rallying sharply yesterday the price is looking for a fresh move to the upside, although an immediate catalyst is lacking. The AUD/USD has rallied since February, with a higher low in mid-March, and a higher high at the beginning of April.

The most recent pullback has seen the price head towards $0.74, but if the price can stabilise here then a higher low may be established, potentially putting fresh strength into the uptrend.

Higher commodity prices continue to support the Australian dollar versus its US counterpart, which helps to explain why the pair has rallied while others such as EUR/USD and GBP/USD have remained under pressure. Sellers will want to see a drop back below $0.74 to provide a more bearish view and suggest at least that the pullback from the highs of April has some further room to run, potentially towards $0.733.

AUD/USD Source: ProRealTime
AUD/USD Source: ProRealTime

This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients.

Start trading forex today

Trade the largest and most volatile financial market in the world.

  • Spreads start at just 0.6 points on EUR/USD
  • Analyse market movements with our essential selection of charts
  • Speculate from a range of platforms, including on mobile

Find out more

Live prices on most popular markets

  • Forex
  • Shares
  • Indices

You might be interested in…

<h3>How much does trading cost?</h3>
<h3>Find out about IG</h3>
<h3>Plan your trading</h3>

Find out what charges your trades could incur with our transparent fee structure.

Discover why so many clients choose us, and what makes us a world-leading provider of CFDs.

Stay on top of upcoming market-moving events with our customisable economic calendar.