- EUR USD rate at 1.09 – USD EUR down to 0.91
- Euro aided by lack of interest rate comments from Fed official – German confidence proves unsupportive
- ECB’s Diemer to speak later – US home sales set to rise this afternoon
Continuing the weekly rollercoaster ride of the Euro to US Dollar exchange rate, the single currency has once again risen against the US Dollar, up slightly to 1.09 today.
Yesterday evening’s comments from Fed official Dennis Lockhart did not prove especially insightful, given that the official failed to mention monetary policy.
From the Eurozone, negative news has come from Germany that the GfK consumer confidence result for November has dropped from 10 points to 9.7, against predictions that it would increase to 10.1.
(Last updated October 26th, 2016)
The Euro has fallen by -0.2% against the US Dollar today, in the aftermath of the US Case-Shiller 20-City index.
While not usually a notable data release, the index has shown that US house prices are not being held back by economic pressures, yet are also not in ‘bubble’ territory.
This has only further raised expectations of a December Fed interest rate hike (up to 71%), and boosted the US Dollar to Euro exchange rate to 0.92.
(Last updated October 25th, 2016)
After rallying in response to increased US interest rate hike bets, the US Dollar has pared some of its recent gains amid concerns regarding the US economic outlook.
Euro Exchange Rate News: EUR Mixed Despite Rising German Confidence
Euro exchange rates have been decidedly mixed so far today, although the latest Eurozone data has been significantly positive.
This has concerned the German Ifo surveys of expectations, current conditions and business climate in October.
In all three cases, rises have been recorded, while elsewhere in the Eurozone, Italian industrial orders have risen considerably in August.
A likely reason for continued hesitancy in investing in the Euro is the news that three Belgian regions have held back the signing of the CETA trade deal between the EU and Canada; due to EU laws, a unanimous agreement is required in order to go ahead with the trade deal.
Dollar Euro Exchange Rate Slides despite Fed’s Evans Promoting 3 Interest Rate Hikes
The US Dollar Euro (USD EUR) exchange rate recorded a modest loss, with the ‘Greenback’ also recording a -0.6% decline against the South African Rand (USD ZAR).
The source of this disappointment has been Fed official Charles Evans, who as a voting member of the Federal Open Market Committee (FOMC) gave a speech yesterday evening.
Some of Evans’ comments were US Dollar supportive, including;
‘I suppose I’ve got…three [interest-rate hikes] priced in by the end of next year’.
However, the policymaker also declared that the US growth rate faced a continued level of constraint, which was likely to limit national growth in the long-term.
Future EUR USD Forecast: Euro Volatility Likely on Incoming Draghi Speech
The Euro could rally against the US Dollar this afternoon, when European Central Bank (ECB) President Mario Draghi delivers a lecture on monetary policy.
The policymaker is known for having an influential effect on the Euro, and should the latest German positivity bring talk of policy tightening, the single currency could well rise against the US Dollar and its other regular peers.
The US Dollar (USD) is also set to be shifted by policymaker comments, in the form of a speech this evening from Fed official Dennis Lockhart. While not a voting member of the FOMC, Lockhart nonetheless could boost the US Dollar if he considers that a December interest rate hike is appropriate.
Current Interbank Exchange Rates
The Euro US Dollar (EUR USD) exchange rate was trending in the region of 1.08 and the US Dollar Euro (USD EUR) exchange rate was trending in the region of 0.91 today.