After years of extraordinary monetary policy measures, the ECB is again under pressure to take more actions as the central bank meet for the first time post-Brexit vote. Although Brexit remains the biggest risk threatening Eurozone’s recovery, there are more challenges to be addressed when the central bank meets later today, such as the troubled Italian banks and the plunging yields on governments’ debt which makes it difficult for the ECB to pursue its €80 billion monthly debt purchases without amending the terms of their program.

Most developed economies central banks’ signaled more easing to come this summer, but with no fresh update on the status of the economy and only four months since the ECB implemented new measures by cutting rates 10 basis points and increasing their monthly QE purchased by €20 billion, I do not expect any new major actions to be taken at this meeting.

Mr. Draghi’s only tool is likely to be his dovish words in opening the door for further easing if economic conditions deteriorated, however, this might not be enough to send the Euro lower unless he provides clear guidance to markets on what the central bank could do in September when they release new economic forecasts. If he disappoints EURUSD could climb towards 1.12.

News that Japans government is planning a ¥20 trillion package, twice what had been previously anticipated sent the Yen towards its lowest level since June 10. USDJPY has rallied 700 pips in 9 trading days to trade above 107, and seems there’s more upside potential if BoJ decided to support from the monetary side when they meet in July 28. Risk appetite and higher yields on U.S. treasury bonds also supported the rally, but if correction is due in U.S. stocks after several record highs than the upside is likely to be limited on the short run.

Sterling extended its yesterday’s gains as unemployment rate dropped to lowest levels in more than a decade and BoE’s survey showed no clear evidence of a slowing economic activity from the country’s decision to leave the EU. This outlook is likely to be changed when Markit releases the one-off release of flash purchasing managers index on Friday. It will be the first leading indicator to provide a valuable assessment on the immediate impact post-referendum vote. On the data front today, U.K. retails sales is expected to drop -0.6% in June from 0.9% in May, a steeper decline would likely erase today’s gains.