ECB meeting will affect euro exchange rate

Baku. 21 October. REPORT.AZ/ On October 26, the European Central Bank (ECB) will hold a meeting on the next monetary policy.

Report informs, the meeting may adopt decisions that could have a serious impact on the euro exchange rate.

ECB is expected to decrease monetary expansion volume to 30 bln euro (35.3 bln USD) from 60 bln euro (70.6 bln USD) in the next week's meeting. However, the ECB can extend the stimulus program by the end of 2018. Analysts do not see the ECB's reducing purchase volume of government bonds as a result of the economic recovery in the eurozone alone. Also, shortage of first-class government bonds in the eurozone financial market is also shown as a cause. So, according to ECB's mandate, it can only buy assets of "A" category.

The analytical group of Report News Agency says that reduction of the stimulus program and concrete deadline will support the euro exchange rate, but the continuation of the program in 2018 will hinder strengthening of the euro. Therefore, the main currency pair USD/EUR forecasted to fluctuate between 1.15 and 1.21 by-mid 2018.