The Euro began the week down against a number of its peers after the French government called for a weaker Euro to help boost exports a view not shared by other European leaders.
On Tuesday the single currency weakened against the US Dollar and a number of its major peers after the association of European car makers reported that car sales across the European Union slumped by 5.9% in May. The data showed sharp falls in demand in many key European markets. New car sales fell 10.4% in France, 9.9% in Germany, and 8% in Italy supporting the belief that the Eurozone’s problems are far from over, In Cyprus sales crashed by 41.4%.
The Euro then steadied against the US Dollar midweek as investors awaited the outcome of the Federal Reserve’s monthly meeting late in the day. The markets were looking ahead to the Fed’s rate statement and press conference, which was hoped, would clarify the bank’s stance on monetary policy, after Fed Chairman Ben Bernanke said last month that the bank could begin to taper asset purchases if the economy continued to improve.
On Thursday the currency took a tumble against the US Dollar and fell against the Pound following the Federal Reserve’s announcement that it will in fact begin to curb its quantitative easing programme if the US economy continues to improve.
Adding to the currency’s weakness was the release of data that showed that the latest German Purchasing Manager Index for Manufacturing declined in June. The data caused investors to take a risk off approach as concerns remain over the Eurozone.
On Friday the Euro weakened slightly against the Dollar after data showed that the Eurozone’s current account surplus narrowed sharply in April causing concern that the improvements seen over the past month were flukes.
Major events next week for the Euro
Thursday 27th June – Eurogroup Meeting
Consumer confidence data – 10:00 am
Euro Exchange Rates (as of 12:00 pm GMT)
The Euro is trading against the Pound in the region of 0.8535
The Euro is trading against the US Dollar in the region of 1.3219
The Euro is trading against the Australian Dollar in the region of 1.4322
The Euro is trading against the New Zealand Dollar in the region of 1.7017
The Euro is trading against the Canadian Dollar in the region of 1.3705
The Pound is trading against the Euro in the region of 1.1716
The US Dollar is trading against the Euro in the region of 0.7567
The Australian Dollar is trading against the Euro in the region of 0.6995