The Euro to US Dollar (EUR/USD) exchange rate is trending within a tight range on Tuesday morning.
As traders await both the Eurozone and German economic sentiment data publications, the Euro to US Dollar (EUR/USD) exchange rate is holding steady. With a lack of data to provoke changes, the US Dollar is generally static versus most of its major peers ahead of the Housing Market Index, due for publication later on Tuesday afternoon.
The Euro to US Dollar (EUR/USD) exchange rate is currently trending in the region of 1.1589.
Yesterday…
The Euro to US Dollar (EUR/USD) exchange rate strengthened by around 0.48% on Monday.
As traders speculated on how extensive the European Central Bank (ECB) quantitative easing programme will be, the Euro strengthened versus many of its major peers amid fears the priced-in declination was overdone.
The US Dollar, meanwhile, is generally holding steady against the majority of its currency rivals thanks to a complete absence of domestic data to trigger volatility. A fractional uptrend against some of its competitors is the result of dampened risk sentiment fuelling demand for safe-haven assets.
The Euro to US Dollar (EUR/USD) exchange rate is currently trending in the region of 1.1624.
Euro (EUR) Exchange Rate Advances on QE Uncertainties
After having dropped to an 11-year low with traders pricing-in the European Central Bank’s proposed bond-buying programme, the common currency strengthened against the US Dollar on Monday. This can be attributed to traders speculating that German opposition will lead to a diluted version of the quantitative easing programme.
‘Even if the ECB decides to introduce quantitative easing, a lack of details could send the Euro back to levels before the Swiss move last week,’ Japanese strategist, Ikeda said. ‘The Euro could surge to $1.20 if the ECB only keeps repeating itself.’
The Euro to US Dollar (EUR/USD) exchange rate dropped to a low today of 1.1549.
US Dollar (USD) Exchange Rate Holds Steady on Lack of Data
With a complete absence of domestic data to provoke changes, the US Dollar is generally holding steady against most of its major peers. A fractional appreciation can be attributed to dampened market sentiment following the Swiss National Bank’s decision to remove its Euro floor, with increased demand for safe-haven assets.
‘The theme we are seeing is one of general risk reduction,’ said a London based currency strategist. ‘Investors generally lost money when the floor went. As a response we are seeing investors generally reducing risk in the FX market. Bullish dollar is the most prevalent theme, so as people reduce exposure it’s long-dollar trades, which are trimmed back the most.’
Euro to US Dollar (EUR/USD) Exchange Rate Forecast to Strengthen
With a lack of data to curb the trend, the Euro to US Dollar (EUR/USD) exchange rate is likely to continue to trend higher. However, the uptrend is likely to be short-term as we near the ECB’s long-awaited intervention.
The Euro to US Dollar (EUR/USD) exchange rate advanced to a high today of 1.1630.