The ECB Rate Decision and What the Market Priced Wrong

The ECB's June decision was fully priced by markets — or so they thought. The surprise was not the cut itself but the accompanying statement, which removed the phrase 'data-dependent future cuts', signalling a slower path ahead.

EUR/JPY had the largest single-session move of Q2: a 180-pip reversal from session highs. Traders who were positioned for a dovish follow-through were caught offside.

Lesson from the desk: price the press conference, not just the decision. Rate-sensitive pairs move on guidance, not rate changes that were already discounted weeks earlier.