EUR/USD cautious ahead of ECB, near 1.1260

The single currency is trading on a cautious fashion on Thursday, taking EUR/USD to the 1.1250/60 band ahead of the key ECB meeting.

EUR/USD focus on ECB, Comey, UK

Spot is extending its erratic performance so far this week, meandering in the mid-1.1200s as the ‘Super Thursday’ is already upon us.

In fact, the pair should be under pressure in light of the critical ECB meeting. This month’s gathering has grown in importance amidst increasing market chatter regarding the possibility that the central bank could change to a more hawkish wording in its statement.

However, recent news citing the ECB could revise lower its inflation forecasts for 2019 and the recently published lower-than-expected inflation figures for the month of May have somewhat removed some support to this view.

The pair will also pay close attention to the testimony by former FBI Director James Comey before the Senate Intelligence Committee, putting special emphasis on the buck and, of course, President Trump.

In the European night, UK elections results should show who the next UK’s PM will be, while the pair’s price action expected to hinge on EUR/GBP’s performance.

In the data space, EMU’s GDP figures are expected to show the economy of the bloc expanded 0.5% in the January-March period and 1.7% on an annualized basis.

EUR/USD levels to watch

At the moment, the pair is up 0.04% at 1.1260 and a breakout of 1.1284 (2017 high Jun.5) would target 1.1300 (high Nov.9 2016) en route to 1.1367 (high Aug.18 2016). On the flip side, the next down barrier emerges at 1.1202 (low Jun.1) followed by 1.1181 (20-day sma) and finally 1.1108 (low May 30).