The US dollar remained well supported on Friday, with the currency continuing to catch bids in light of the Federal Reserve’s recent hawkish shift.
While forecasts had pointed towards a narrowing of the surplus it instead grew from €18.2 billion to €20.5 billion on the month, suggesting a greater degree of trade resilience.
Coupled with the relative weakness of the US dollar, this helped to push EUR exchange rates higher on Friday, even as worries over the health of the Eurozone economy linger.
At the same time, March’s factory orders and industrial production data both indicated better-than-expected growth.
As the German ZEW economic sentiment index rose to a 21-year high in May from 70.7 to 84.4, this offered additional support to the single currency.
The appeal of the euro could strengthen further on the back of a sharp rebound in Eurozone industrial production for March.
As long as the currency union demonstrates signs of resilience in the face of ongoing pandemic-based disruption, this may limit any potential EUR exchange rate downside.
However, the release of the European Central Bank’s (ECB) most recent set of meeting minutes could provoke some extra euro volatility on Friday after some of the bank’s policymakers expressed different opinions on its outlook and bond-buying programme.
Joining the corporate trading desk in 2007, Phil now over sees all of Currencies Direct’s corporate dealing activity. Having gained experience working with hundreds of businesses to optimise international payments processes and execute comprehensive risk management strategies, Phil currently works with a portfolio of corporate clients whilst managing Currencies Direct’s overall market exposure
Phil has FCA approval and has completed the Certificate in International Treasury Management (CertiTM)