Euro Rises on ECB’s Hawkish Words
Posted on 12. Dec, 2008 by admin in Daily Euro Analysis, Euro Currency, Euro Currency News
The Euro-Zone currency rallied against its major counterparts as risk appetite and the demand for yield increased. The grim economic news from the U.S. economy, such as the Senates’ rejection of the U.S. Auto bailout plan helped pushed the EUR forward to reach a 7 week high against the USD. The Euro rose 2.3% to close at $1.3366 after hitting an intraday high of $1.3405, and against the JPY, the EUR reached an intraday high of $122.72 and closed at 119.43.
The Euros’ strength owed much to the hawkish comments from German Bundesbank President and member of the Governing Council of the European Central Bank (ECB) Axel Weber that that the ECB is unlikely make another Interest Rate cut in January during the next ECB meeting.
Looking ahead to today there is the release of the European Industrial Production at 10:00 GMT. Analysts forecast that the metric may recover slightly by 0.6% from the previous month of -1.6%. If the forecast is met, then such a result is likely to be reflected in a bullish EUR. Traders are advised to follow U.S leading indicators throughout the day, as these data releases are likely to generate the largest impact on the market today.
