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EUR/JPY rallies on unfulfilled ECB rumors, ECB cuts deposit rate

FXStreet (Córdoba) - EUR/JPY broke above the 131.00 level and hit fresh 2-week highs even the European Central Bank decided to cut the deposit rate by 10 bps in a widely expected move.

EUR/JPY shooted higher and climbed more than 150 pips to a peak of 131.77 as minutes before the ECB statement, FT reported the bank was to leave rates unchanged against expectations of a deposit rate cut. At time of writing, EUR/JPY is trading at 131.45, up 0.48% on the day.

The ECB statement made no comments on the bond buying programme, but Draghi is due to speak at 13:30 GMT. He is expected to announce an extension of QE.

ECB cuts interest rate on the deposit facility by 10bp

As reported in the ECB official statement, at today’s meeting the Governing Council of the ECB decided that the interest rate on the deposit facility will be decreased by 10 basis points to -0.30%, with effect from 9 December 2015.
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Draghi delivers on promise, ECB cuts deposit rate by 10bp

Investors had been hoping for Mario Draghi to deliver on promises after risk suffered following Fed’s Yellen’s comments that she was "looking forward" to hiking U.S. rates. Draghi did not quite disappoint. At today’s meeting the governing council decided to slash deposit rate by 10 basis points. The deposit rate now at -0.30 per cent moves further into the negative territory. The decision will come into effect from 9th December 2015.
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