The euro, which had hit a one-month high of $1.0094 earlier in the day, fell below parity with the greenback after the ECB’s decision. The single currency recovered some of its losses against the strong dollar, and down 1% to 0.9985.
“The dollar is recovering in light of stronger-than-expected data and the ECB’s emphasis on the gloomy outlook for the eurozone economy,” he said. Joe Manimbo, senior market analyst at Convera, in dialogue with Reuters. “It’s a reminder that nothing has fundamentally changed about the euro, and negative fundamentals have put pressure back on the single currency.”
The US economic growth recovered more than expected in the third quarter amid a continuing decline in the trade deficit, but that exaggerates the health of the economy as Aggressive Federal Reserve interest rate hikes curbed consumer spending.
The greenback had fallen in recent days, as investors have assimilated the signals that the Fed is considering slowing its aggressive hikes of rates in December. Nevertheless, the dollar reversed its course on Thursday in what analysts considered a natural rebound after a heavy fall.
“I think profit-taking at this level is not unheard of,” he said. Alvin Tan, head of Asia forex strategy at RBC Capital Markets. “Since Monday, the euro-dollar is up about 2.2%, so we’ve had a pretty big move in the dollar over the last two days.”
Source: Ambito
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