European Central Bank decided to leave its monetary policy unchanged, as well as repo rate. ECB President Mario Draghi said that ECB considers the monetary policy to be highly accomodative and there have been no discussions on further monetary policy, a year later for example. At the same time Dragi mentioned that it wis to be desided according to economic conditions when to exit the current policy.
As for the OMT, Draghi said that ECB is ready to act but at first the country has to request aid and get conditionality.
These comments came togather with the information that EC ministers may delay the approval of new loan to Greece. Despite generally favorable developments, including the Greek Parliament's decision to support the new round of austerity measures, the euro failed to recover and continues to consolidatea bit above recent lows.
The pair EUR/USD printed a fresh 2-month low at 1.2716 after the ECB and EU decisions on Thursday. EUR/USD broke decisively below 1.2740 (38.2% retracement of the broader 1.2040/1.3171 rally) and set a 2-month low of 1.2716. Technically, the outlook remains bearish, with 1.2700 as immediate target, followed by 1.2600 (50% retracement of the same run). On the upside, the 20-hour SMA (1.2750) is acting as dynamic resistance in the short term, while only a recovery above the 200-day SMA (1.2822) could provide relief.