After strengthening last week on the back of comments issued by the European Central Bank regarding the Eurozone returning to growth by the end of the year, the Euro was little changed against the US Dollar as Monday’s European progressed despite some less-than-impressive news.
The Euro Exchange Rate was in the region of 1.3220 against the US Dollar as of 12:20 GMT
Although the Euro dipped against the US Dollar after Friday’s non-farm payrolls report, the common currency recouped losses as French President Francois Hollande asserted that the fiscal crisis which has plagued the Eurozone for the past several years is now over.
During a speech in Tokyo Hollande commented: ‘You must understand that the crisis in the Eurozone is over. Europe has become more stable, but it must now be oriented toward growth. I believe that the crisis, far from weakening the Eurozone, will strengthen it. Now, we have all the instruments of stability and solidarity. There was an improvement in the economic governance of the Eurozone, we set up a banking Union, we have rules on budgetary matters that allow us to be better coordinated and have a form of convergence’.
The Euro continues to trade above 1.32 against the US Dollar
Hollande’s assurances bolstered the Euro, and the currency was little affected by some disappointing data.
Firstly, a Sentix gauge of investor confidence in the Eurozone declined by more than expected, hitting -11.6 in June rather than -11.3 as expected. Although this was an improvement on May’s -15.6 figure it wasn’t as large an improvement as hoped for.
Then Italian GDP figures showed that the nation’s economy contracted by more than expected in the first quarter of the year.
A drop in exports and dimming household spending saw GDP fall 0.6 per cent quarter-on-quarter and 2.4 per cent year-on-year, compared with initial estimates of 0.5 and 2.3 per cent declines.
Recent data has shown that Italian unemployment rate is currently at its highest level for over 36 years and last week Ignazio Visco (Governor of the Bank of Italy) stated: ‘The recession is deeply undercutting potential output and threatens to erode social cohesion.’
It is expected that Italy will post economic contraction of 1.8 per cent this year, followed by growth of 0.4 per cent in 2014.
The Euro continues to trade above 1.32 against the US Dollar. Domestic data which could impact the pairing in the week ahead includes Wednesday’s German CPI and Eurozone Industrial Production, Thursday’s publication of the European Central Banks Monthly Report and Friday’s Eurozone CPI.
Current Euro (EUR) Exchange Rates
< Lower > Higher – Little Changed
The Euro/US Dollar Exchange Rate is currently in the region of: 1.3220 >
The Euro/Pound Sterling Exchange Rate is currently in the region of: 0.8516 >
The Euro/Australian Dollar Exchange Rate is currently in the region of: 1.4020 >
The Euro/ New Zealand Dollar Exchange Rate is currently in the region of: 1.6783 <
The US Dollar/Euro Exchange Rate is currently in the region of: 0.7564 <
The Pound Sterling /Euro Exchange Rate is currently in the region of: 1.1743 <
The Australian Dollar/Euro Exchange Rate is currently in the region of: 0.7138 <
The New Zealand Dollar/Euro Exchange Rate is currently in the region of: 0.5960 >
(Correct as of 12:20 GMT)
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