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The Euro is tipped to weaken due to persistently low inflation 'staying the ECB's hand' at their policy meeting on Thursday.

Global investment bank TD Securities have given their expectations for where the Euro will travel in response to today's European Central Bank (ECB) meeting with the publication of a handy 'cheat-sheet' for the event.

Analysts are overall bearish the Euro, seeing an aggregate 75% probability of the headline EUR/USD exchange rate falling to the 1.22's; the exchange rate is currently trading at 1.2409.

This would be expected to place downside pressure on other crosses, including the Euro-to-Pound exchange rate, currently quoted at 0.8923. This therefore implies upside pressure on the Pound-to-Euro exchange rate which we see going back towards the middle of its longer-term range at 1.13; the exchange rate is currenty quoted at 1.12.

The base case scenario, with a 65% probability, is that the ECB will not change the language of its future strategy, also known as its 'forward guidance', despite saying it would do so "at the start of 2018" back in the December 2017 meeting.

The specific language to be changed relates to the ECB's "easing bias" which is what they call the pledge that they stand ready to use more stimulus or quantitative easing if necessary.

With regards to the press conference, TD Securities think Mario Draghi will dodge questions about altering the language of the forward guidance, saying, simply, that 'whilst the subject was discussed in the meeting there was not enough support from the governing council to agree on a change'.

Draghi is also likely to defend the 'easing bias' because of the reality of continued low inflation in the Euro-area and the possibility that further stimulus may still be required to combat it.

However, it is important to note that any resultant weakness is likely to remain short-lived as the base-case scenario is no game-changer for the single-currency.

"Most scenarios favour moderate downside risks for EURUSD. Those should remain contained, however, and dip buyers should emerge," says Jacqui Douglas, Chief European Macro Strategist at TD Securities.

The EUR/USD is forecast to go to 1.2280 under the base-case scenario.

Hawkish Possibility / Euro to Rise: 25%

TD Securities assigns a 25% probability of a hawkish outcome which would see EUR/USD rise to 1.2555 and we would expect this to boost the Euro against a host of other smaller crosses, the Pound included.

Within the hawkish expectation, they make a distinction between a 'Less Hawkish' and 'More Hawkish'.

The former 'Less' variety would see a change in the statement of forward guidance from a focus on the specifics of QE - in terms of size and duration - to a broader pledge of "looser for longer".

The more hawkish variation would see the promise to wind down QE uncoupled from the condition of seeing "sustained inflation" first.

Dovish Possibility / Euro to Endure Sharp Fall: 10%

The least likely outcome for TD securities is that the ECB adopts a more dovish tone, by which it is meant that it is in favour of keeping stimulus going for longer than previously thought and interest rates low; to this, they assign a 10% probability.

In a dovish scenario, the ECB would not change the language of their forward guidance but would alter the statement to suggest that growth in the region was now 'past its peak'.

A dovish scenario would see the EUR/USD exchange rate fall to 1.2205.

In the press conference with president Draghi, he would state that inflation is still too low to for QE to be dispensed with in September.

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