The euro retreated today, following the huge gains on Friday, as the eurozone unemployment rate rose and investors speculated that the central bank may decrease its interest rates.
Eurostat reported that the eurozone unemployment rate rose to 11.1 percent in May from 11.0 in April. The increase was small and expected by market participants. Still, it reminded traders that problems of the region are not solved and it is too early too overly optimistic about the euro.
Moreover, the European Central Bank will have a monetary policy meeting this week and it weighs on the shared 17-nation currency. Most analysts believe that the ECB would slash it key interest rate by 25 basis points to 0.75 percent.
EUR/USD dropped from 1.2676 to 1.2576 and EUR/JPY slumped from 101.23 to 99.93 as of 23:16 GMT today. EUR/GBP was down from 0.8074 to 0.8014 and it actually erased its Friday’s gains.
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