EUR: ECB policy stability shapes outlook – HSBC

According to a recent HSBC report, the European Central Bank (ECB) has decided to maintain its key deposit rate at 2%. This decision significantly impacts the market's perception of the euro. Notably, the stability of the ECB's policy provides a sense of security for investors, reflecting sustained growth expectations for the eurozone economy. The ECB's interest rate policy is closely tied to recent inflation trends and economic growth indicators. Maintaining flexibility in future monetary policy will aid in supporting the euro's resilience and stability. However, geopolitical risks and global economic uncertainties may still put pressure on the euro, warranting caution. Therefore, market participants should keep a close watch on developments and how the ECB's stance may evolve, as these factors will influence the euro's value. Considering these factors, the euro may maintain a stable trajectory in the near term, but it remains susceptible to external influences.