The euro struggled this week to sustain its rally against the US dollar. The speculation that the euro was overbought limited its gains but the fundamentals were supporting the currency for the most part.
Against the US dollar and the Japanese yen the currency showed the same pattern. It strongly declined after China’s decision to raise the interest rates, which drove the investors to the safer currencies. But in the second half of the week the euro attempted to rise as the economic reports were quite good. The uncertainty as to outcome of the G-20 meeting hadn’t allowed the European currency to gain.
The moves of the euro versus the Great Britain pound were rather different. While the euro also fell versus the pound after the Chinese rates hike, afterwards it strongly rallied and ended this week high above the opening level.
EUR/USD fell this week from 1.3972 to 1.3929 and its weekly low level was 1.3698. EUR/GBP advanced from the opening level of 0.8863 to 0.8882. EUR/JPY rose a little from 113.20 to 113.31 after it slumped as low as 112.59 this week.
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