ECB to raise borrowing costs | 23 May 2023

EURUSD trading plan:

The European Central Bank still needs to raise its interest rates further and then leave them in restrictive territory for a while to bring inflation down to its medium-term goal of 2%, ECB policymaker Pablo Hernandez de Cos said. Traders expect the ECB to raise borrowing costs twice more by the end of the summer - taking the rate it pays on bank deposits to 3.75% - before it starts cutting them next year. Devos said that interest rates will have to remain in restrictive territory for an extended period of time to achieve our objective in a sustained manner over time.

Investment idea: buy 1.0785 and take profit 1.0870.