EURCAD Euro vs Canadian Dollar

The euro dropped against its most major counterparts in European deals on Monday ahead of the European Central Bank policy meeting later this week, with economists expecting it to keep its interest rates and asset purchase program unchanged.

The ECB Governing Council will meet in Frankfurt on July 19-20, with investors awaiting the policy statement for any changes in language towards tighter monetary policy.

The bank is expected to keep its refi rate at zero percent, marginal lending facility at 0.25 percent and the deposit rate at -0.4 percent. The central bank is expected to continue the monthly bond-buying program of €60 billion.

Analysts expect an announcement on winding down asset purchases to come as soon as September, as Draghi's remarks at the ECB forum in Sintra appeared to have hinted at possible tweaks to ECB policy in the coming months.

Final data from Eurostat showed that Eurozone inflation slowed to a 6-month low in June as estimated.

Inflation eased slightly to 1.3 percent in June from 1.4 percent in May. The rate came in line with the flash estimate published on June 30.

This was the weakest rate seen so far this year. The European Central Bank targets inflation 'below, but close to 2 percent'.

Meanwhile, European stocks fell slightly despite another record close on Wall Street Friday and positive cues from Asia after Chinese GDP data beat estimates.

The euro held steady against its major counterparts in the Asian session.

Reversing from an early high of 1.1055 against the Swiss franc, the euro edged down to 1.1025. Continuation of the euro's downtrend may see it challenging support around the 1.08 zone.

The single currency weakened to 1.1435 against the greenback, off its early 5-day high of 1.1475. The next possible support for the euro-greenback pair is seen around the 1.13 mark.

The euro edged down to 128.74 against the yen, from a high of 129.15 hit at 6:30 pm ET. If the euro-yen pair extends decline, 126.00 is likely seen as its next support level.

The euro hit a 4-day low of 1.4484 against the loonie, off its early high of 1.4515. The euro may challenge support around the 1.43 area.

On the flip side, the euro rose to 0.8769 against the pound, from an early low of 0.8745. The euro is seen finding resistance around the 0.885 area.

Survey by the Confederation of British Industry showed that British firms said 'Brexit' has affected their investment decisions.

Over 40 percent of respondents said 'Brexit' influenced their decision and 98 percent of them said that the impact has been negative.

Looking ahead, Canada existing home sales data for June and New York Fed's Empire manufacturing index for July are slated for release in the New York session.

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