- Euro US Dollar 2016 Exchange Rate Below 1.09 – Lowest value since October
- Central Bank Moves Speculated – ECB takes cautious stance on US election result
- EUR Forecast: Rebounds Possible – If USD weakens next week
- USD Forecast: Pragmatic Trump? – Markets ponder Trump’s ‘Presidential’ tone
Euro US Dollar 2016 Exchange Rate Hits Worst Value Since January
The Euro to US Dollar continued to trend lower throughout Friday’s session as concerns about the rise of populism weighed heavily on Euro demand.
After the Brexit and Trump votes this year, some have speculated that nationalistic populism could spread to the Eurozone and destabilise the Euro project. This left the shared currency trending limply against a stronger US Dollar.
While the Euro may be strengthened next week if Q3 Eurozone growth stats impress traders, this concern could dampen EUR trade for the short to long-term future.
The US Dollar continued to perform strongly as markets opened on Friday. While some of the Trump bullishness seen on Wednesday and Thursday faded, EUR USD looked to end the week below the key level of 1.09.
(Previously updated 13:00 GMT 11/11/2016)
Friday morning saw the Euro US Dollar 2016 exchange rate cool slightly from the bearish behaviour seen on Wednesday and Thursday, but the pair continued to trend with a downward bias before American markets opened.
The Euro gained no considerable support from the morning’s Eurozone data, which revealed that German inflation had met preliminary figures in October as expected.
After the excitement in US markets over the last few days, analysts are curious to see if this US bullishness will continue or if traders will rethink the possibility of an anti-trade President Trump.
(Previously updated 16:50 GMT 10/11/2016)
Euro US Dollar 2016 Exchange Rate Continues to Tumble as Trump Recovery Rally Continues
The Euro US Dollar 2016 exchange rate continued to trend downward throughout Thursday’s trade session, hitting its lowest levels since late-October.
Markets continued to hope for a more pragmatic President Trump and were also cheered by speculation that the Trump regime would propose plans for higher spending and lower taxes in the US to stimulate inflation.
Some analysts have suggested EUR USD could hit parity in the next 12 months due to the strong movement of the exchange rate’s current trajectory, but more hints of trade protectionism from Trump could still weaken the US Dollar.
(Published 10:47 GMT 10/11/2016)
The Euro US Dollar 2016 exchange rate saw wide value fluctuations and volatility on Wednesday as traders reacted to the surprising US election win of Donald Trump. Markets cooled later in the day to reveal that EUR USD was surprisingly lower than it had been on Tuesday.
The popular EUR USD exchange rate began the week at 1.11 and tumbled towards Tuesday as investors expected a Clinton win. However, despite briefly surging to a two-month-high of near 1.13 after the result came in, the pair has since fallen and now trends around 1.09.
Euro (EUR) Weakened by ECB Speculation and Resurgent US Dollar
Many analysts had expected the Euro to emerge stronger from a surprise Trump election win, but Wednesday’s trade session proved many market expectations wrong and this was one of them.
Due to the Euro’s negative correlation with the US Dollar, it was widely anticipated that the drop in US Dollar value following Trump’s win would mean a Euro rally.
While this currency movement initially appeared to be becoming reality as the Euro US Dollar 2016 exchange rate surged while election results came in, market movement cooled far quicker than expected as Wednesday trade progressed.
The Euro also simply lacked the upside factors to allow it to rally freely. The shared currency was anything but the first choice for investors choosing to store their assets in something safer than the US Dollar, with traditional ‘safe haven’ currencies like JPY taking focus instead.
Comments made by the European Central Bank (ECB) also weighed on Euro demand and added to the shared currency’s downside risks.
Following the election result, the ECB was quick to signal that it was prepared to expand monetary policy if necessary to defend the Eurozone economy from shock. Austrian central bank head Ewald Nowotny compared the market situation to that of the Brexit aftermath;
‘With Brexit, the reaction was dramatic and strong, then it stabilized again but a higher level of nervousness remained, I fear that we’ll now experience just such a phase of medium-term uncertainty.’
US Dollar (USD) Stabilises Quickly as Markets Hope for Calmer Trump
The US Dollar was immediately destabilised when it became evident to investors around the world that Trump’s election figures had been far better than expected.
This was due to the controversial protectionist stance Trump had taken on trade throughout his campaigning. These protectionist views had been perceived as a threat to global markets, which was widely expected to send US markets and the ‘Greenback’ into shock.
However, when Trump took his acceptance speech soon after the results came in, the unexpectedly ‘Presidential’ tone he took calmed markets considerably.
There was no mention of some of his most controversial ideas and some analysts even suggested we could see a more pragmatic President Trump compared to the fiery man seen on the campaign trail.
US markets were also cheered from their initial shock during Wednesday’s American session, as a Trump economic adviser, Judy Shelton, stated to The Wall Street Journal that Trump would not urge Janet Yellen to resign from the Federal Reserve.
She stated ‘He’s not urging her to resign at all’ but went on to indicate that Trump would not nominate Yellen for a second term as Fed Chair after 2018, saying ‘He’s saying he’d want someone whose thinking is more in keeping with his own.’
Euro US Dollar 2016 Exchange Rate Forecast: Potential Trump Comments to Move Rates
US President-to-be Donald Trump hasn’t spoken much publically since his acceptance speech in the early hours of Wednesday morning. His words at that time were enough to keep global markets from a full Brexit-style meltdown, but traders remain on edge amid the almost palpable uncertainty.
With global markets still highly unsure of what exactly to expect from a Trump Presidency, anything Trump says in interviews or statements in the coming days are certain to have an effect on US Dollar exchange rates.
If Trump continues to avoid bringing up his more controversial policy proposals, the Euro US Dollar 2016 exchange rate could continue to trend downwards as hopes of a more pragmatic President Trump rise.
However, if Trump so much as indicates that he still intends to act on his more protectionist proposals on trade or foreign policy, the US Dollar could plunge allowing EUR USD to rise.
Friday will see the publication of Germany’s final October Consumer Price Index (CPI) figures, which could also affect Euro exchange rates if market movements continue their return to normalcy.
At the time of writing, the Euro US Dollar 2016 exchange rate traded at around 1.09, while the US Dollar Euro exchange rate trended in the region of 0.91.