- Single currency remains mixed as ‘Brexit’ fallout continues – European Union future remains uncertain
- US Dollar strong overall despite confidence outcome – University of Michigan prints disappointing figures
- US goods orders also drop – Safe-haven demand buoys US currency nonetheless
- EU Referendum vote likely to have major long-term impacts – Concern for wave of EU referendums
The Euro has continued to weather turbulence in currency markets today, which has come on account of the EU Referendum vote resulting in a ‘Brexit’.
The US Dollar has also held its position, having fallen against the Japanese Yen but generally risen against everything else due to high demand. Domestic data for the US has been uninspiring; durable goods orders in May have fallen from 3.3% to -2.2% on the month, while the University of Michigan consumer sentiment result for June has dropped from 94.7 to 93.5.
Looking ahead, the future of the Eurozone has been called into serious question, due to the fact that many right-wing groups across the Eurozone have been calling for their own European referendums in objection to EU policy.
(Last updated 11:46 June 24th, 2016)
UK Brexit from the EU Sends the Currency Market into Turmoil, Euro (EUR) US Dollar (USD) Exchange Rates Frantic
Both the Euro (EUR) and US Dollar (USD) exchange rates were plunged into turmoil on Friday as the UK voted to Brexit from the European Union.
The surprising result sent the EUR/USD exchange rate to 1.1031, down 3%, while the EUR/GBP exchange rate climbed to a high of 0.8315.
Further fluctuations occurred as Prime Minister David Cameron announced his resignation. It is expected that the PM will remain in his post until the Autumn before passing the torch.
Scottish politicians were also keen to highlight that the nation will desire another referendum on its place in the UK in light of this latest development.
With the markets expected to experience significant volatility as the day continues, stick with us for the latest news.
(Previously updated 24/06/2016)
The Euro has managed to remain in a position of strength against the US Dollar recently, having posted a rise of 0.4% against the ‘Greenback.
The US currency has remained in a position of weakness throughout the day, with the latest downtrends being partly caused by new home sales in May dropping significantly. In a more supportive development, however, claims have fallen in June while the manufacturing PMI for the same month has rise from 50.7 to 51.4.
As with earlier, the outcome of the EU Referendum remains the key point that may shift the Euro and the US Dollar irreparably; results are due to first come in part eleven o’clock tonight, while the final outcome is due to come around seven tomorrow morning.
(Last updated 13:30 June 23rd, 2016)
The Euro has been an unstable option on the most part today, owing to the fact that voting for the EU Referendum is now in full swing. Earlier on, Eurozone PMIs for June gave mainly negative results, with the only recorded gains being for manufacturing in Germany and the Eurozone.
French manufacturing PMI fell from 48.4 to 47.9 in June, with the Services measure also moving into the contraction range.
The US Dollar has remained in a low state so far today, with the arrival of the vote likely cementing its undesirable status over the course of the next 24 hours.
Previously, the US currency was given mixed blessings, when in spite of Fed Chair Janet Yellen regarding the US economy optimistically, the amount of stored gasoline in US inventories rose sharply against predictions.
Over the course of the day, the pairing can be expected to shift notably as EU Referendum results come in, with high volatility being a virtual guarantee.
(First published 07:00 June 23rd, 2016)
With the UK public taking to the polls to vote on the EU referendum today, both the EUR/USD and EUR/GBP exchange rates are likely to experience volatility in the hours ahead. As it stands, the common currency has advanced by 0.2% against the Pound and edged slightly higher against the US Dollar.
The Euro has been a relatively stable option against the US Dollar this week, on account of the ‘Buck’ failing to properly recover against its peers.
This limited positive movement from the ‘Greenback’ has come from EU Referendum concerns, as well as issues regarding future Fed interest rate decisions.
Eurozone Economic News: Consumer Confidence Slides but Euro Steady Regardless
The single currency has been positive against the US Dollar recently, having climbed across the course of the week on generally supportive ecostats.
Most notable among these have been Tuesday’s ZEW surveys measuring economic sentiment and current conditions in June, which have risen across the board for both Germany and the Eurozone.
More recently, and less supportively, the Eurozone-wide consumer confidence flash for the same month fell yesterday, from -7 points to -7.3.
Capital Economics Assistant Economist Andrew Wishart issued a response to the news, stating:
‘Even assuming that the UK votes to remain in the EU tomorrow, the outlook for the Eurozone’s consumer sector remains weak’.
US Dollar Continued to Slide after Second Day of Testimony from Fed Chair
The appeal of the US Dollar has been notably low over the present week, with limited domestic data serving to leave fears of ‘Brexit’ implications in full view.
In terms of national stats, existing home sales in May rose from 5.43m to 5.53m yesterday afternoon, although a second round of comments from Fed Chair Janet Yellen did little to enthuse investors, owing to their generally cautious and predictable nature.
Future EUR, USD Forecast: EU Referendum Voting Likely to Destabilise Euro and US Dollar
With voting for the UK’s membership of the EU now officially underway, it seems a distinct probability that neither the Euro nor the US Dollar will be able to make much headway against each other until the actual result of the vote is announced later on tomorrow morning.
This is on account of clearly voiced concerns by economists from both economic areas in the past; repeated claims have been made from Eurozone economists that the currency bloc could be irreparably damaged in the event of a ‘Brexit’, while similar fears have been voiced in the US, where some believe that trillions of Dollars in trade could be lost should the UK leave the EU.
In terms of actual domestic data relevant to each currency, the Euro has a chance of being influenced by a range of Eurozone-wide PMI flashes for June which are due this morning.
In a surprising display of market optimism, forecasts have been for increases across the board for individual countries and the Eurozone itself, although estimates have been tentative, with only single point increases on the previous scores being predicted.
US contributions to the pairing will consist of claims stats for mid-June during the early afternoon, as well as the later manufacturing PMI flash for the same month, new home sales data for May and a speech from the Fed’s Robert Kaplan during the night.
Claims are expected to be reduced slightly based on previous figures, the manufacturing PMI is forecast to rise and a shift from 619k to 531k is on the cards for the number of new homes sold.
Recent EUR, USD Exchange Rates
The Euro to US Dollar (EUR/USD) exchange rate has been trending in the region of 1.1285 and the US Dollar to Euro (USD/EUR) exchange rate has been trending in the region of 0.8865 recently.