It’s not easy time for Europe’s residents and European Central Bank’s decision makers. Ongoing war in the Ukraine with foreseen, intensified warfare and consequences of COVID-19 pandemic influenced economics of many countries. Naturally, the charts show that DAX and CAC40 trade higher than before the outbreak of the virus. To me, it only supports the thesis all mentioned events stopped European indices, companies and countries from growing much, much further.

Emphatic European Central Bank (ECB) Let Economies Recover And Stay Strong?

Since 2016 the ECB interest rate has amounted to 0%. Having in mind all the events which took place throughout last six years it seems to had been a correct decision. Coronavirus crisis influenced countries despite their economic status so tighter monetary policy would have weaken the euro and equities even further. But…

Related article: ECB Interest Rate Decision Is Coming! European Indices (DAX, CAC40) To Plunge Or Rise? What About Forex Pairs?

Inflation Is Taking Its Toll!

Although the Russia-Ukraine warfare is still there and negotiations don’t seem to be working and stimulus for markets is highly demanded, the inflation is gaining momentum around the world. ECB is trapped in. These two contradictory factors may make decision makers confused, but let’s have a look how have markets reacted to today’s monetary policy statement of ECB.

Forex: EUR/GBP Chart Shows Consequent Move Of The Price

Strengthening of euro or weakening of British pound is driven by i.a. inflation data coming from the United Kingdom. The news coming from the UK in past months weren’t so optimistic as the inflation hit 30-year-high.

EUR/GBP Chart

Forex: EUR/USD influenced by both – ECB interest rate decision, war and Fed’s rhetoric

As the week is coming to the end we see how many factors shaped the rates of certain currencies. This week’s inflation data of USA and the release of crude oil inventories make the asset quite volatile. Yeah… The right hand side… That’s a drop!

EUR/USD Chart

DAX Regained After Trading Lower Yesterday’s Morning

Significant, ca. 2% decrease is almost compensated.

DAX (GER40) Chart

CAC40 Is Heading To A 1% Gain

French index has been more aggressive until now. Today’s opening gain brought some optimism to investors.

CAC40 Chart

Source/Data: Investing.com, TradingView.com

Charts: Courtesy Of TradingView.com