# Euro jumps after hawkish comments from ECB’s Lagarde Author: Pal Sinha, Barnali Author URL: https://financedigest.com/author/pal-sinha-barnali Published: 2022-02-03 Category: NEWS Category URL: https://financedigest.com/category/news Meta Title: Euro jumps against dollar after ECB comments drive rate Meta Description: Euro jumps on ECB president Lagarde's comments on faster monetary policy tightening, euro zone money markets predict rate hikes leading to speculation. URL: https://financedigest.com/euro-jumps-after-hawkish-comments-from-ecbs-lagardehtml ![undefined](https://prod.superblogcdn.com/site_cuid_cm5qst7v3003gwirgwqtxn8i8/images/2022-02-03t090311z1lynxmpei120bjrtroptp4ireland-economy-1736816270576-compressed.jpg) By Stefano Rebaudo (Reuters) -The euro jumped against the dollar on Thursday after comments from ECB president Christine Lagarde fuelled expectations of faster monetary policy tightening, although the central bank confirmed its guidance for interest rates and its bond purchase programme. Lagarde acknowledged that inflation was running hotter than expected and with risks tilted to the upside, but continued to forecast it would ease through this year. Asked if the [European Central Bank was “very unlikely” to raise rates](https://www.financedigest.com/ecbs-villeroy-rate-hike-signals-strong-confidence-in-european-banks.html "ECB’s Villeroy: rate hike signals strong confidence in European banks") this year, Lagarde said it would assess conditions very carefully and be “data-dependent. Euro zone money markets are currently pricing an 80% chance of a 10 bps hike in June and an almost 100% chance of 40 bps of hikes by year-end, from a 90% chance of 30 bps hikes before Lagarde’s [press conference](https://www.financedigest.com/5-top-tips-when-holding-a-crisis-press-conference.html "5 Top Tips When Holding a Crisis Press Conference"). \[IRPR\] “The ECB has today [opened the door](https://www.financedigest.com/lack-of-electric-vans-opens-door-for-chinese-other-ev-makers.html "Lack of electric vans opens door for Chinese, other EV makers") to market speculation for a tightening of its monetary policy,” Stefano Pesole, forex strategist at ING, said, adding that he sees the euro-dollar exchange rate in a range of $1.13-1.15 in the short term. “The market is free to speculate that it might [change guidance at its monetary policy](https://www.financedigest.com/exclusive-hsbc-fund-arm-toughens-thermal-coal-policy-to-curb-climate-change.html "Exclusive-HSBC fund arm toughens thermal coal policy to curb climate change") meeting in March,” he added. The euro was up 0.8%, hitting its highest [level since](https://www.financedigest.com/ukraine-war-energy-crisis-send-german-business-sentiment-to-lowest-level-since-june-2020.html "Ukraine war, energy crisis send German business sentiment to lowest level since June 2020") January 18 at $1.1411. Meanwhile, a slump in tech [stocks on Wall Street soured risk appetite and provided some support to the dollar](https://www.financedigest.com/world-stocks-cling-to-upbeat-mood-dollar-stalls.html "World stocks cling to upbeat mood, dollar stalls"). U.S. stock indexes opened lower on Thursday, with the Nasdaq diving more than 2%, as Facebook-owner [Meta Platforms’](https://www.financedigest.com/meta-to-wind-down-nfts-on-platforms-amid-crypto-bust.html "Meta to wind down NFTs on platforms amid crypto bust") dour forecast jolted the broader tech sector and threatened to upend a nascent recovery in stock markets. The U.S. dollar index, which measures the greenback against six rivals, fell 0.5% to 95.513, after [falling for three days in a row](https://www.financedigest.com/sentiment-among-german-exporters-falls-for-third-month-in-a-row-ifo.html "Sentiment among German exporters falls for third month in a row -Ifo") from around 97.3 on Monday. Analysts think that the more significant challenge to the greenback has come from Europe as stubbornly high [inflation is prompting a re-assessment of the ECB](https://www.financedigest.com/big-fall-in-euro-zone-inflation-offers-little-help-for-ecb.html "Big fall in euro zone inflation offers little help for ECB") stance which is providing support to European currencies. [Sterling jumped versus the euro after the Bank](https://www.financedigest.com/dollar-outshines-euro-sterling-amid-european-bank-jitters.html "Dollar outshines euro, sterling amid European bank jitters") of England raised interest rates to 0.5% on Thursday, and nearly half its policymakers wanted a more significant increase to contain rampant price pressures. The British pound was up 0.6% at 83.78 pence versus the [euro while rising](https://www.financedigest.com/euro-rises-after-spanish-cpi-dollar-slips-towards-8-mth-low.html "Euro rises after Spanish CPI, dollar slips towards 8-mth low") 0.2% versus the greenback. Bitcoin fell 0.9% to trade around $35,570, while ether, the [world’s second-largest cryptocurrency](https://www.financedigest.com/the-importance-of-nfts-in-the-cryptocurrency-world.html "The Importance Of NFTs In The Cryptocurrency World"), was down 2.4% at $2,618. (Reporting by Stefano Rebaudo, Editing by Kirsten Donovan) --- This blog is powered by Superblog. Visit https://superblog.ai to know more. ---