Both markets showed resilience to the risks associated with the events of the European Central Bank (ECB), maintaining stability despite the fact that ECB President Christine Lagarde did not adopt an extremely dovish stance. At the end of the session, the euro recorded a slight decline, but the currency pair continued to fluctuate around the level of 1.05.

ING analysts have observed that the trend of interest rates in the euro zone is on a downward trend, and they expect that rates may exceed the neutral threshold of 2.00/2.25%.

The recent widening of the government bond spread between Italy and Germany was seen more as a result of profit-taking and position adjustments than as a reaction to the ECB’s awareness of a potential economic slowdown in the euro zone.

The spread was previously extremely narrow, suggesting that the current change does not indicate any major concerns about the direction of the ECB’s monetary policy.

The EUR/USD pair is expected to remain near the 1.05 level during the day. Market participants are eagerly awaiting next Wednesday’s Federal Open Market Committee (FOMC) meeting, which is expected to be the next significant event affecting the dollar.

Those brief in EUR/USD are expected to maintain their position as it is considered a positive position. The short-term trading range is expected to be between 1.0450 and 1.0550.

In Switzerland, the Swiss National Bank (SNB) decided to cut interest rates more decisively by 50 basis points. Martin Schlegel, the recent president of the SNB, expressed his aversion to negative interest rates, but admitted that the bank was willing to introduce them if necessary.

Although it is not entirely convinced about the negative interest rate scenario for the SNB next year, ING maintains that the SNB is unlikely to cut interest rates as deeply as the ECB, predicting a downward trend for the pair.

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