Weekly Roundup: Euro recovers amid USD weakness

Amy Richards December 5th 2022 - < 1 minute read

The euro fluctuated last Monday due to its negative correlation with a volatile US dollar. However, expectations that the European Central Bank (ECB) may opt for a smaller interest rate rise at its next meeting dented EUR.

These headwinds intensified as the week went on as the Eurozone’s latest CPI showed that inflation cooled more than expected in November.

However, EUR’s correlation with USD saw the single currency jump higher on Thursday as the US dollar slumped. Meanwhile, the Eurozone unemployment rate unexpectedly fell to a record low, adding to the euro’s upside.

The common currency ended the week on a mixed note. A decline in German exports and Eurozone PPI dented EUR, while ongoing USD weakness buoyed it.

The euro is off to a strong start this week, shrugging off some downbeat data to rise against its key rivals.

Looking ahead, German industrial data could impact EUR, with the single currency struggling if the results signal trouble in Europe’s largest economy.

Some speeches from ECB officials, including the bank’s President Christine Lagarde, could also affect the euro. Will dovish comments weigh on the common currency?

Written by
Amy Richards

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