Draghi's comments hurt EUR
EUR/USD hit $1.3129 before recovering to $1.3160 on the ECB’s Draghi’s comments.
- Growth risks are to the downside, though there was hope of a more balanced view given the recent improvements in data.
- Economic growth outlook is pessimistic. GDP in 2013 is still expected to contract (by 0.4% vs. 0.6% previously). The growth forecast for 2014 was revised down from +1.1% to +1.0%.
- Recent developments (i.e. taper talk) could negatively affect economic conditions.
- Rates will stay low for ‘extended period’.
- The ECB actually discussed a rate cut.