After yesterday’s ECB President comments suggesting that the economic recovery in the region will be a hard process, the euro fell versus a number of main traded currencies, and headed to complete the second week of losses versus the dollar.
The euro suffered the influence of European Central Bank Jean-Claude Trichet’s declaration yesterday affirming that interest rates are not set for hikes in the short-mid-term and that the recovery in the countries using the European common currency will be, using his words, “bumpy”, decreasing attractiveness for the euro which is losing for a fourth week in a row against the Swiss franc. Trichet as long as other members of the ECB commission board are due to speak today in Frankfurt, increasing speculations that yesterday’s dovish tone may be reconfirmed today, decreasing attractiveness for the euro which lost today also versus the pound, after several weeks of gains against the British currency.
Yesterday’s statements were more negative than what traders expected, according to analysts. Some improved economic data was expected to be interpreted with significant optimism by the ECB board, but a rather cautious position affirming that interest rates won’t be raised so soon decreased attractiveness for the European common currency today.
EUR/USD traded at 1.4283 as of 7:11 GMT after touching 1.4355 yesterday. EUR/CHF traded at 1.5140, trading at a rather neutral level from yesterday but losing on the weekly comparison.
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