The Euro to US Dollar (EUR/USD) exchange rate strengthened by around 0.11% on Tuesday. This is as a result of French growth figures meeting with expectations. The US Dollar, meanwhile, is generally holding steady against its major peers whilst traders await Durable Goods Orders data.
The Euro to US Dollar exchange rate is currently trending in the region of 1.2233.
Yesterday…
The Euro to US Dollar (EUR/USD) exchange rate strengthened by around 0.35% on Monday afternoon. This is as a result of better-than-expected Eurozone consumer confidence. Quiet Christmas trading has seen minimal impact from data, but coupled with support from rising oil prices, the Euro is likely to continue trending higher. The US Dollar, meanwhile, has generally softened against most of its competitors after domestic data produced mixed results.
The Euro to US Dollar exchange rate is currently trending in the region of 1.2265.
Euro (EUR) Exchange Rate Gains on ECB QE
Having plummeted significantly on previous mentions of quantitative easing by the ECB, the shared currency strengthened on Monday after traders reversed their stance on the afore mentioned stimulus initiative. ‘In case of sovereign QE, it’ll be difficult to square the circle to make everybody happy,’ said Marco Valli, an economist at UniCredit SpA in Milan. ‘But they are trying to make it as consensual as possible, bringing on board some of the smaller states. It would be important for the credibility of any sovereign QE program to reduce dissent as much as possible.’
As is the case with all economic programs, however, feelings towards QE are unlikely to ever be unanimous. ‘Our base case assumes that Mr. Draghi will implement sovereign QE boldly,’ said Huw Pill, chief European economist at Goldman Sachs Group Inc. in London. ‘But we entertain a variant scenario where Mr. Draghi seeks compromise with the QE-skeptics. Such a compromise has the potential to disappoint markets.’
The Euro to US Dollar exchange rate dropped to a low today of 1.2220.
US Dollar (USD) Exchange Rate Holding Steady ahead of Data
As traders await economic data pertaining to the US, the ‘Greenback’ (USD) has held relatively steady against its major peers. Any changes are as a result of wider market fluctuation.
The Chicago Federal Reserve National Activity Index is forecast to tick higher from 0.14 to 0.25. Existing Home Sales, however, is forecast to decline from by -1.1% following the previous month’s gain of 1.5%.
Euro to US Dollar (EUR/USD) Exchange Rate Forecast to Soften
Although US data is forecast to produce mixed results, sentiment towards the US Dollar is generally positive. Therefore, there is the possibility that the US Dollar will recover losses against the shared currency.
The Euro to US Dollar exchange rate climbed to a high today of 1.2273.
