Weekly Roundup: Euro fluctuates lower amid dovish ECB expectations
Amy Richards September 25th 2023 - < 1 minute read
The euro fluctuated last Monday amid mixed comments from European Central Bank (ECB) policymakers over the possibility of more rate hikes in the future.
A downward revision to the Eurozone’s final CPI reading then dampened ECB bets, adding to expectations that the bank may have finished its hiking cycle.
Choppy trade hit the euro midweek, amid a lack of data. The euro’s safe nature and negative correlation with a volatile US dollar saw the currency trade in a wide range.
The common currency then firmed on Thursday, as risk aversion and a weaker dollar lent EUR support.
However, the euro finished the week with more volatility. A changing market mood impacted EUR, along with mixed PMI surveys. Overall, EUR finished the week slightly lower against many of its peers.
Turning to this week’s session, the focus for EUR investors is the Eurozone’s flash CPI for September. If it shows easing inflation, as forecast, then this could reinforce expectations that the ECB is done raising rates and the euro could plunge.
Ahead of the CPI we have German consumer confidence and retail sales, Eurozone economic sentiment, and a handful of ECB speeches. Could weak data and dovish comments see EUR stumble?
Written by
Amy Richards