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Posted December 11th, 2013 by Charles Purdy

Euro gains ground despite worries

The euro continued its remarkable run of strength yesterday as it reached a five-week high against the US dollar during the afternoon and appreciated moderately against sterling. The day’s manufacturing data sets were mixed with French figures showing contraction in the sector and Italian figures coming out showing slightly better growth than expected. The Eco-fin meetings may have also impacted positively upon the performance of the single currency as European finance ministers looked to be working towards a single resolution for failing European banks. Today is a quieter day on the whole for data releases with the only releases of note are German inflation data and French unemployment figures. Call your trader now to manage your exposure ahead of Mario Draghi’s next address on Thursday.

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Posted December 10th, 2013 by Charles Purdy

Poor German data has limited impact on the euro

The euro traded within a very narrow range against the US dollar whilst weakening slightly against sterling yesterday. Notably, German Industrial Production figures for October showed a 1.2% decline, making this the strongest decline in the Eurozone’s largest economy since May. German trade balance figures, which detail the difference in value between imports and exports, also came through slightly worse than expected. The single currency continued to show resilience in the face of negative data and despite weakening slightly against sterling, did not lose much ground in other major pairings. Today, French Industrial Production data may have some influence on euro performance when it is released this morning, however a speech by the President of the European Central Bank (ECB) at noon is more likely to cause volatility.

Posted December 9th, 2013 by Charles Purdy

Lots of data, will it be good news for the euro?

The euro continued to strengthen against the majority of its major trading partners towards the end of last week as confidence in the single currency increased further. The rally came following the speech by the President of the European Central Bank (ECB) on Thursday. Mario Draghi refrained from reducing interest rates further which contributed towards the euro’s longest period of appreciation against the US dollar since June. Mario Draghi is due to deliver two more addresses this week, both of which have potential to move the euro. Mario Draghi will speak in Rome on Tuesday before discussing ECB policy further in Strasbourg on Thursday.

Posted December 6th, 2013 by Charles Purdy

No news is good news for the Euro

The euro saw relatively little movements in major pairings during the early stages of the week before the sleeping lion was awoken following European Central Bank (ECB) President Mario Draghi’s statement. Whilst interest rates for the Eurozone remained at record lows of 0.25%, Draghi refrained from raising the possibility of negative interest rates as he did in the previous month or any mention of another round of longer term refinancing operations. Improved inflation data and a slightly improved economic outlook prevented Draghi from mentioning further interest rate reductions, which would have impacted negatively on the seventeen-nation currency. The week’s data releases before Thursday were mixed, with French manufacturing data coming in at notably lower levels than expected and Spanish Services figures showing an improvement.

Posted December 5th, 2013 by Charles Purdy

Euro awaits today’s decision on interest rates

The euro saw little net movement against sterling and the US dollar in another day of mixed data from the Eurozone. However, the single currency did depreciate sharply against the US dollar in the early afternoon, before making a swift recovery by the end of the day. Retail figures for the seventeen-nation bloc were down on expectations, revealing a decrease in consumer spending. Italian Services data was also disappointing as we saw contraction, whereas Spanish Services PMI provided the most positive news of the day for the Eurozone revealing more growth than was expected. Today sees the first European Central Bank (ECB) interest rate decision since last month’s unexpected rate reduction.

Posted December 4th, 2013 by Charles Purdy

Will the ECB undermine the Euro today?

The single currency performed reasonably well yesterday ahead of tomorrow’s interest rate decision and following press conference. The euro appreciated against the US dollar for most of the day whilst we saw the sterling – euro rate briefly spike above 1.21 before the euro recovered. The buoyancy of the single currency came as a result of increased optimism ahead of tomorrow’s rate setting meeting. After the European Central Bank (ECB) unexpectedly reduced the refinancing rate from 0.5% to a record low of 0.25% last month the euro experienced considerable depreciation. However, following this month’s improved inflation data and taking into account the fact that we are fast approaching the Christmas break, few are expecting the ECB to take any radical action ahead of the New Year.

Posted December 3rd, 2013 by Charles Purdy

Euro maintains downward trajectory against sterling

The euro traded within a relatively narrow range yesterday in the absence of any key releases. Spanish Purchasing Managers’ Index data was weaker than expected, showing contraction rather than growth in the struggling nation. Italian manufacturing figures however, came out as expected and showed moderate growth in the sector. The single currency did lose some ground against sterling early on, but regained some of this lost ground during the course of the day. The most influential data coming out today is likely to be Spanish unemployment figures, due this morning. An increase in numbers of jobless claims is expected, but the extent of the increase could determine how the seventeen-nation currency performs today.

Posted December 2nd, 2013 by Charles Purdy

Will the ECB cut interest rates further?

Unemployment and inflation figures for the seventeen member region on Friday were better than expected which reduced pressure on the European Central Bank (ECB) to further loosen monetary policy this week ultimately buoying the euro. On Friday, Standard and Poor’s (one of the big three credit rating agencies) simultaneously lowered Holland’s credit rating due to lowered growth forecasts whilst upgrading Spain’s outlook to stable despite data on Friday showing unemployment in Spain had reached fresh record highs of 26%. This week there is a lot of data being released that could impact the single currency. Eurozone Inflation figures released on Tuesday precede the GDP and Retail Sales figures on Wednesday.

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