* Euro depressed after comments from ECB Knot
* Sterling hits new high from May 2018
* Graphic: World FX Rates https://tmsnrt.rs/2RBWI5E
LONDON, January 27th (Reuters). The euro fell under pressure on Wednesday after a European Central Bank official said the bank was closely monitoring the currency while the dollar rose ahead of the first Federal Reserve meeting of the year.
Klaas Knot, a member of the Governing Council of the ECB, said the central bank had room to lower its deposit rate further should it be necessary to improve funding conditions and meet its inflation target.
Knot’s comment was the most explicit hint yet from an ECB policymaker about the possibility of a rate cut to stem a rally in the euro – a move that until recently seemed highly unlikely.
The single currency has risen nearly 15% since March last year, against a dollar that most analysts expect to see further decline. Knot’s comments came as the euro, already weaker that day, extended losses against the greenback.
It was last traded 0.3% lower at $ 1.2120.
Analysts said Tuesday that the ECB was investigating whether differences from Fed policy in the US would boost the euro – part of a broader review of funding conditions – that would not have a material impact on the currency.
It’s « probably one of those headlines about a buy in euros / dollars, » Jordan Rochester, FX strategist at Nomura, said in a statement to clients. He’s long on the pair with a target of $ 1.25 through March.
Alexandre Dolci, G10 FX strategist at BBVA, has a similar view.
« Despite the strong positioning, we continue to prefer buying the euro / dollar on drops as the pair stabilizes in a range of $ 1.20 to $ 1.25, » he said.
ECB President Christine Lagarde has repeatedly stated that the central bank is carefully monitoring the exchange rate of the single currency.
« We suspect they might find that higher inflation in the US is more believable and that the euro / dollar spot is more closely tied to global manufacturing (which is doing well), not European services, and that expectations are in Regarding Europe are possibly higher comeback, « said Lars Sparresø Merklin, senior analyst at Danske Bank. « In both cases, this adds to a growing number of countries that are uncomfortable with USD weakness. »
The dollar reversed the early fall in Asia, rising 0.3% to 90.393 as markets waited for comments from Federal Reserve Chairman Jerome Powell, who is likely to renew his commitment to ultra-light policy.
Powell will speak at a news conference after the central bank’s two-day policy meeting, which ends Wednesday.
Earlier this month, he said in a web symposium with Princeton University that the US economy is still far from the Fed’s inflation and employment targets and that it is too early to discuss a change in monthly bond purchases.
« While the Fed has been consistent over the past few months that the balance of risk is still on the downside, we have been able to take a more neutral stance, » said John Velis, FX and macro strategist at BNY Mellon.
« This would be seen as a slightly Hawkish turn for the committee, but we believe the Chairmanship will make it clear that neither rate hikes nor a quantified timetable for reducing bond purchases are being considered. »
Elsewhere, the British pound rose to $ 1.3753, its highest level since May 1, 2018, before trading flat at $ 1.3730.
The Australian dollar fell 0.4% to 77.18 US cents, matching Tuesday’s 0.5% rally.
(Reporting by Ritvik Carvalho; editing by Larry King, Kirsten Donovan)
Which country changed the currency after the introduction of the euro?
|country||Currency name||Convert from|
|Malta||Maltese lira||January 31, 2008|
Why did Germany switch to the euro?
Experts say Germany is committed to the euro and willing to go to great lengths to protect it. « Germany found it very difficult to give up the Deutsche Mark – it was a symbol of the country’s recovery and it was a great sacrifice to give up in order to join the euro, » said Loughlin.
Has the UK ever used the euro?
The United Kingdom is part of the European Union but does not use the euro as its common currency. The UK has kept the pound sterling because the government has determined that the euro does not pass five critical tests that would be required for its use.
What was the lowest euro exchange rate ever?
GBP to Euro (all-time highs, lows and forecasts explained)
- On May 3, 2000, the pound hit an all-time high of 1.752 euros against the euro. …
- The weakest pound compared to the euro on December 30, 2008 was € 1.02. …
- The pound to euro exchange rate averaged € 1.33 throughout its 20-year history.
How are euros written?
If you are writing out an amount in euros, use the currency symbol or the euro symbol u20ac. Note that the u20ac symbol precedes the amount and that there is no space between them (e.g. u20ac 50). The rent for Jose and Maria’s Spanish villa is 750 per month.
Where do you put the euro symbol?
The symbol for the euro is € and is often placed after the number, as opposed to the pound sign – £ – that comes before the number.
What is on the euro banknotes?
Windows and doors are depicted on the front of both series of euro banknotes. They symbolize the European spirit of openness and cooperation. The bridges on the back symbolize communication between people in Europe and between Europe and the rest of the world.
How do you make the euro sign on a Mac?
And finally, if you want to find the Euro sign on a Mac keyboard, try either Alt + Shift + 2 or just Alt + 2.
Are there different euros for each country?
All banknotes are the same throughout the euro area. In contrast to the euro coins, there are no different designs for different countries. One side of each coin is the same in all euro countries. The other side is different as each country that mints the coins inserts a symbol for that country.
What is the symbol of the euro?
Is the euro stable?
Not only will volatility risks and exchange rate costs be eliminated and the internal market strengthened, but the euro will also mean closer cooperation between Member States for a stable currency and economy for the benefit of all of us.
When was the euro highest?
Historically, the euro-dollar exchange rate – EUR / USD hit an all-time high of 1.87 in July 1973. The euro was only introduced as a currency on January 1, 1999.
Which countries use the euro?
You can use the euro in 19 EU countries: Austria, Belgium, Cyprus, Estonia, Finland, France, Germany, Greece, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, the Netherlands, Portugal, Slovakia, Slovenia and Spain . Find out more about the euro, which countries use it and the exchange rates.
Why is the euro bad for Europe?
By far the greatest disadvantage of the euro is a uniform monetary policy, which often does not correspond to local economic conditions. It is common for parts of the EU to thrive with high growth and low unemployment. In contrast, others suffer from persistent economic downturns and high unemployment.
Which EU country last introduced the euro?
Lithuania joined the European Union in 2004 and introduced the euro on January 1, 2015.