The Euro has begun the week higher against the US Dollar, Pound and Japanese Yen as banks in the Eurozone draw back foreign-held assets before the end of the year and as it found support from comments made by a European Central Bank chief Mario Draghi.
The single currency is trading just off of a five year high against the Japanese Yen and is close to its highest level since October 2011 against the ‘Greenback’. It’s on target to make a second straight year of gains against the US currency. Against Sterling the Euro is trading just below the psychologically key 1.20 mark.
Despite the continually weak economic picture for the Eurozone the currency has performed far better than many economists had expected. The Euro received a boost this week and last from banks that are repatriating funds ahead of an ECB Asset Quality Review and who are repaying the ECB’s cheap loans issued during the Euro crisis.
ECB President Mario Draghi told a German newspaper over the weekend that he does not believe that there is an urgent need to cut the regions interest rate any further and said that there are no signs of deflation occurring in the Eurozone economy. His words set investors at eased.
Despite its recent positive performance several economists are expecting the Euro to weaken at the start of 2014.
“We remain sceptical of Euro strength and will be watching funding rates in the first days of the new year for signs that the liquidity squeeze which supported the Euro mid December is continuing to fade,” said BNP Paribas.
The only data to come out of the soon-to-be 18-nation bloc when Latvia joins the EMU on January 1st – this week is the Manufacturing numbers on Thursday. The German PMI is anticipated to remain at 54.2 during December and the Eurozone figure is likely to stay at 52.7.
Current Euro (EUR) Exchange Rates
The Euro/US Dollar Exchange Rate is currently in the region of: 1.3796
The Euro/Pound Sterling Exchange Rate is currently in the region of: 0.8364
The Euro/Australian Dollar Exchange Rate is currently in the region of: 1.5508
The Euro/ New Zealand Dollar Exchange Rate is currently in the region of: 1.6869
The US Dollar/Euro Exchange Rate is currently in the region of: 0.7248
The Pound Sterling /Euro Exchange Rate is currently in the region of: 1.1954
The Australian Dollar/Euro Exchange Rate is currently in the region of: 0.6447
The New Zealand Dollar/Euro Exchange Rate is currently in the region of: 0.5927
(Correct as of 15:10 pm GMT)
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