Markets price only a 16% chance of another ECB rate hike in July as policymakers weigh further moves.
The European Central Bank’s communication this week will shape expectations after its recent rate hike, with traders assigning minimal odds to another increase in July. The EUR/USD pair has struggled to sustain momentum, failing to break above 1.1650 despite last week’s policy move.
Prior to the hike, markets had priced a higher probability of additional tightening, but the ECB’s current stance suggests a more measured approach. Analysts note the central bank appears comfortable with the reduced likelihood of a July move, signaling potential caution ahead.
EUR/USD remains rangebound, with no clear catalyst for a breakout above key resistance levels. The pair’s underperformance reflects lingering uncertainty over the ECB’s next steps and broader economic conditions.