The euro falls but aims for the highest monthly profit in one year – SABC News

The euro returned some of its recent gains on Tuesday, but was still set for the best month in a year as markets regrouped in the run-up to interest rate hikes in Europe and the possibility of a slower pace of US rate hikes.

The euro was at 1.0745 dollars, down 0.3%, after reaching a five-week high of 1.0786 dollars overnight, as German inflation rose to its highest level in almost half a century in May behind rising energy – and food prices.

This strengthens the argument for more aggressive interest rate hikes from the European Central Bank, which is expected to start raising interest rates in July for the first time since the pandemic began.

Information on the consumer price index in the euro area is expected later on Tuesday, and CBA experts said that the German data indicate the possibility that this could be above expectations as well.

In addition, “There are several ECB officials speaking tonight, no doubt talking about the prospect of higher interest rates in Europe,” they said in a comment to clients.

The euro is also aiming for a 2.2% rise in May, which would be its largest monthly rise in a year.

The dollar index was 101.63 and had fallen to a five-week low of 101.29 last night.

The index measures the currency against six peers with the greatest weight given to the euro.

“Emphasis has shifted from rising inflation and higher interest rate hikes to concerns about whether the Central Bank’s restraint has put pressure on the economy, which has weakened the dollar in recent weeks,” said Redmond Wong, Saxo Markets Hong’s marketing adviser. Kong.

He added, however, that there was no guarantee that the Central Bank would turn away from an aggressive pace of restraint, citing hawkish remarks from Governor Christopher Waller overnight, noting “so that this weaker dollar trend could be reversed”.

A surge in attitudes towards riskier assets and currencies, partly due to the easing of closures in China’s financial center, Shanghai, has also weighed on the safe haven recently, investors say.

News of EU leaders agreeing on Monday to cut most oil imports from Russia by the end of this year has raised oil prices and boosted commodity currencies.

The Canadian dollar touched $ 1.2653, close to a one-month high tonight.

The Australian dollar jumped from the low of 0.7163 $, also helping out better than expected PMI data from China and was last around 0.77180 $.

Bitcoin was at the top of about $ 31,600 after rising above $ 32,000 overnight for the first time in just over three weeks.

Sterling was at $ 1,263, aiming for a 0.5% monthly profit against the dollar, its first monthly increase in 2022.

The yen was at 128.15 dollars, softer during the day, but heading for the strongest month since July last year.

The euro falls but aims for the highest monthly profit in one year – SABC News

Source link The euro falls but aims for the highest monthly profit in one year – SABC News

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