The Euro has had a hard time over the past 20 trading sessions losing ground on a consistent basis. On May 3rd EURUSD reached a most recent high at 1.16159 to then tumble to yesterday’s low at 1.10972. Most the Euro’s decline has been due to weakness in the Euro area economy. Latest GDP growth data showed the economy has expanded at 0.5%, which was less than analysts’ forecasts.
Adding to the Euro’s woes, recentlyrenewed sentiments of multiple interest rate hikes in the US happening during 2016 have taken hold of the market. The possibility of higher interestrates in the US is helping the currency gain against most major currencies. Until recently the most hawkish comments had come from Federal Reserve directors, who do not vote on monetary policy decisions.
However, last Friday Ms. Yellen the Federal Reserve Chair made a speech at Harvard, which was considered by the market as being extremely hawkish. Meaning that more interest rate hikes are to be implemented this year; with the next one possibly taking place at the scheduled Federal Open Market Committee meeting this June 15th at 7:00 pm.
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