Currency News: A Brief Overview EUR/USD
Currency News
A Brief Overview Of EUR/USD in this week’s currency news
2016 has started with nervousness, uncertainty, and a very volatile market due among other reasons to the decline in commodities. Currencies are not the exception and are also affected by the economics politics.
Despite a lot of analysis said that Eur/Usd ratio will drop and get closer to parity in early 2016, it is easy to realize that nothing happened as it is shown in the image.
(Source: Yahoo)
What is it expected to happen if FED announces to keep the low interest rate? As it is normally in this kind of cases, the higher interest rate tends to be associated with the higher value of the currency, but this theoretical assumption could not be right now. Euro has already appreciated by about 10 percent against USD. Now other fundamentals seem to take over. Euro couldn’t cross 1.40.
Also, it depends on other factors, for example, the current data from the US economy, where the data about manufacturing activity in the New York region is disappointing and also because the market sentiment is still very weak.
Finally, President of the European Central Bank, Mario Draghi, announced on Monday that the bank will not hesitate to act to boost inflation and growth in the euro area, suggesting the possibility of implementing further easing measures.
