EUR/AUD Exchange Rate at 2014 Low, EUR/GBP, EUR/USD Little-Changed ahead of US Data Releases

The Euro (EUR) to Australian Dollar (AUD) Exchange Rate declined to its worst level of the year so far on Tuesday, the woes for the single currency continued against the Pound (GBP) and US Dollar (USD) after weak data, and the resignation of the French Government weighed.

Against the US Dollar the Euro sank to its lowest level in 11-months after a speech by European Central Bank (ECB) President Mario Draghi at Friday’s Jackson Hole Symposium saw economists raise their bets that the Central Bank will aim to keep the currency weak in an attempt to try and restart the Eurozones stalled recovery.

Many investors are placing wagers that the Euro will continue its fall, even though that stance has been proved unsuccessful over the past two years.

In the futures market, investors have bigger bets against the Euro than at any point in the past two years.

Some are predicting that the ECB will roll out a plan to buy bonds, just as the Federal Reserve did, as soon as its December meeting.

“It would be helpful for the overall stance of policy if fiscal policy could play a greater role alongside monetary policy, and I believe there is scope for this, while taking into account our specific initial conditions and legal constraints,” Mr. Draghi said in his prepared remarks.

The single currency came under more pressure during the UK’s Bank Holiday on Monday after economic data released in Germany showed that business sentiment declined for a fourth consecutive month in August and on the news that the French government resigned over a bitter row over the nation’s economic policies.

The collapse of the French government came after Economy Minister Arnauad Montebourg condemned the nation’s fiscal policies and attacked Germany’s obsession with austerity measures.

‘The whole world is begging us to put an end to these absurd austerity policies which are burying the Euro zone deeper and deeper in recession and which will soon end up with deflation,’ said Montebourg.

The Euro regained some ground on Tuesday as the markets took a breather ahead of the publication of US economic data due for publication in the afternoon and as the markets turned jittery ahead of a meeting between Russian President Vladimir Putin and Ukrainian President Petro Poroshenko.

It is hoped that the two leaders will try to bring the violence in the east of the country to an end, a move that would see the lifting of harmful retaliatory economic sanctions between the EU and Russia.