The ECB's decision to significantly expand its stimulus measures and, if necessary, to continue this process for a considerable period of time led to a rise in the rate of the single European currency

The result of the June meeting of the European regulator was largely unexpected for the markets. Yes, investors believed that the regulator would not only leave interest rates unchanged, but also a program of emergency purchases of assets during the pandemic period (PEPP) in the amount of 500 billion euros. However, something unexpected happened. The bank decided to expand the volume by almost two and a half times, to 1.35 trillion euros. Moreover, it was previously expected that the program would be expanded to 750 billion euros. Another important point was the decision to extend the terms of the program by 1 year until June 2021 with the obligation to reinvest the proceeds in the purchase of other assets until the end of 2022.

This surprise from the ECB led to the growth of the EUR/USD pair to mid-March levels, and now the pair has gained an objective growth potential to the maximum value of March 9, that is, the level of 1.1500. An additional incentive to increase the euro not only against the dollar, but also to other currencies against which it is traded in the market, was the speech of the ECB President C. Lagarde. She clearly stated that the regulator will continue to increase quantitative easing in a flexible manner, buying assets by 20 billion euros monthly until the end of this year. She also said that the risks for the European economy remain "downward", that "junk bonds" will not be bought, which is an important signal that the bank will not change its principles of risk management. She also made it clear that the European economy is at its lowest point, followed by growth, and that it expects inflationary pressures to ease in the next few months.

To sum everything up, it can be noted that the most important point that stimulated the growth of the Euro currency on the currency market is overcoming serious contradictions by European countries, at least at the current stage, which was previously a negative phenomenon that contributed to the weakening of the Euro currency.

Today, the attention of the market will be focused on the publication of data on employment in the States. According to the forecast, the US economy lost 8 million jobs in May compared to 20.537 million in April. The unemployment rate is expected to rise to 19.8% in May against 14.7% in April.

How can the US dollar react to this data? If they turn out to be slightly better than expected, this can only push the dollar towards growth temporarily, but no more. The main "negativity" for the US currency is still the broadest program of incentive measures from the US Treasury and the Fed, which turned the dollar into a funding currency again, the weakening of interest in dollar assets, the yield of treasuries came out of the side dynamics and rushed up, pointing to sales in the US government debt sector, as well as active demand for risky assets.

We believe that if the dollar receives local support, it will be a signal for investors to continue selling it again.

Forecast of the day:

The EUR/USD pair is trading above the level of 1.1345. It can correct down to 1.1315 on the wave of possibly positive data from the US and local overbought. At the same time, this decline may lead to the continuation of the pair's purchases and its continued growth to 1.1450 with a global target of 1.1500.

The EUR/JPY pair is above the level of 124.00. If it holds above it, then there is a chance to rise to the level of 125.00. At the same time, a decline below this level will lead to a 23% Fibonacci pullback to 122.70, from which it will be possible to continue buying the pair.