He euro rose slightly and the Japanese yen weakened on Monday, at the start of a week that will see the Bank of Japan meeting and the latest data to be released before the Federal Reserve and European Central Bank decide on interest rates at Begginings of may.
The euro was up 0.25% against the dollar at $1.1015, breaking above the $1.10 level again for the first time since hitting a 14-month high of $1.10755 earlier in the month.
German business morale rose slightly in April, a survey showed on Monday, adding to positive signs that Europe’s biggest economy hopes to have dodged a recession during the winter. In addition, the president of the Belgian central bank and head of ECB monetary policy, Pierre Wunsch, was very optimistic.
The euro’s gains were more striking against the Japanese yen, up 0.63% to 148.3 yen, as the yen came under pressure from new Bank of Japan Governor Kazuo Ueda’s remarks about the need to maintain an expansive monetary policy. The euro is a breath away from the 148.385 yen it hit in October, and going above that level would be its highest since late 2014.
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The dollar was also up 0.36% against the yen at 134.60 yen. Both the Fed and the ECB will meet next week, but before that markets will digest first-quarter US GDP and personal consumption spending (PCE) data, looking for signs of economic stress and evidence of inflation. rigid for clues about the Fed’s monetary policy path.
At next week’s FOMC meeting, the market expects policymakers to hike rates another 25 basis points, though the focus will be on guidance for further moves.
Markets expect the ECB to raise rates by a quarter of a point, with the possibility of a 50 basis point hike. Eurozone inflation and growth data will also be released this week. Meanwhile, sterling was trading flat at $1.2435 and the Swiss franc was up slightly at 0.8903 to the dollar.
Source: Ambito
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