Dollar loses participation: the ECB puts pressure on the euro






The fall in the dollar is the most relevant news on this trading day, limited by the closure of many Asian exchanges. The euro is gaining ground with an ECB determined to raise rates.

He ate asian markets Limited by the closure of many Stock Exchanges for the Lunar New Year, the dollar is the protagonist of this financial week.

Specifically, the Dollar has weakened against most of its counterparts, while Japanese equities have rallied and European futures are higher.

The focus, on this day of weak trade and with China paralyzed by the holidays, is on the foreign exchange market and, above all, on the effect that central banks are having on the euro-dollar exchange rate. The single currency is recovering, driven by a AEC which seems more aggressive in its rate policy than the Fed.

Effect of central banks on markets: weak dollar

The couple EUR/USD exchange rates at 1.0901 at approximately 8.20, highlighting a single currency boost and vice versa a weakening dollar.

In detail, theEUR maintains the upper hand against the US Dollar at the start of the week, boosted by hawkish comments from AEC and general weakness of the US currency.

Eurotower Board Member Klaas Knot said on Sunday: “Expect us to hike rates by 0.5% in February and March, not done until then, with further steps to follow in May and June”.

His colleague Olli Rehn noted that he sees significant reasons for this. “gods of ascension interest rate by the ECB this winter and next spring.”.

Meanwhile, the latest Reuters poll of economists showed most expect the ECB’s deposit rate to peak at 3.25% in the second quarter of this year, up from estimates of 2.75% a month ago.

Hawkish expectations from the European central bank, combined with big bets on a slowdown in the pace of Federal Reserveare helping to reduce the monetary policy divergence between the two central banks, in turn driving the pair higher EUR/USD.

also the American dollar remains hampered by the advance of Japanese stock exchanges and by the positive closing Wall Street last Friday, which slows down the purchase of the dollar as a safe haven asset.

Source: Money It

Share this


Anti-democratic drift in Brazil: what is happening

In Brazil, a repressive and anti-democratic drift orchestrated by the Federal Supreme Court is underway to annihilate Bolsonaro and his popular followers, after the...

Innovation is becoming transformative. What does that mean

Innovation overcomes the crisis by shedding its skin, becoming transformative and integrating everything: digital, green, social, business. Interview with Stefano Denicolai, Professor of...

How the financial network gained political power in Britain

By weaving a web of friendships, unbreakable relationships and economic interests, according to The Guardian, the protagonists of high finance managed to get their...

Recent articles

More like this


Please enter your comment!
Please enter your name here