Euro Stays High Against the US Dollar

The euro has continued to perform better against the US dollar, following the European Central Bank (ECB)  policy meeting last Thursday.

 

At 10AM GMT the euro was buying $1.08, even though this was a fall from the 1.095 mark of yesterday morning.

 

For the majority of the past month, the euro has as sank towards  $1.6 against the dollar.

 

Last month, the euro fell even below that mark, in anticipation of the ECB gathering, and also the growing prospect of a rate rise in the United States.

 

Eventually, the governing council of the ECB decided to deposit interest rates will be decreased by 10 points to -0.3%, and this will come into effect from December 9.

 

The Quantitative Easing programme will be extended to 2017, but this will not be expanded over the EUR 60 billion per month, which was met with disapproval from some market analysts who wanted bolder action.

 

The ECB also announced that the interest rate on the main refinancing operations, and on the marginal lending facility, will remain unchanged at 0.05% and 0.30% respectively.

 

United States Announce Positive Employment Figures

 

The euro climbed on the dollar, despite healthy employment figures that were released for November by the United States Department of Labour, with an additional 211,000 jobs created.

 

For the past 69 months there has now been consecutive private sector job growth, where 13.7 million new vacancies have come onto the jobs market. 

 

Retail figures have also been positive, with good sales figures for the beginning of the holiday shopping season, with auto sales very strong for November.

 

The figures confirm that the United States’ economy  continues to recover at a steady pace, for the third quarter this year growth was 2.9%, comfortably ahead of the euro area.

 

Euro Begins to Fall Against the UK Pound

 

This morning GMT the euro is buying £0.71, a steady fall from over the £0.72 level yesterday afternoon.

 

Since the ECB meeting last week, mirroring the relationship that the euro has with the US dollar, the euro has rose against the pound, peaking to just under the £0.725 mark.

Euro Gains Ground on Asian Currencies

 

The euro has enjoyed an increase in value on the Chinese yuan, after it had suffered a decline against the RMB from the middle of October.

 

From just under the RMB7.3 mark, the euro fell to below the RMB 6.8 level, after the policy announcements filtered through last week, the euro hit RMB7 for the first time in six weeks.

 

In comparison to the Yen, the euro is currently buying Y133, down from the Y134.5 level yesterday morning.

 

That was the highest value that the euro has been against the Yen since October, in similar vein to how the euro has increased against all the major currencies.

 

The decisions taken by the ECB last week have been criticised by some market analysts for being too ‘dovish’.  But there seems to have been enough action taken by the ECB Governing Council to ensure that the euro has become a more attractive proposition.