Euro To Attempt The Significant Level 1.20 Versus A Weak Dollar
Aug, 28th 15:45
The euro rose sharply versus its American counterpart on Monday, extending its gains to a second straight trading session. The single currency surged to the highest level in two and a half year as the dollar has still been dragged down by disappointing remarks of Fed Chair Yellan last week.
The currency pair EURUSD added nearly 0.4 percent to trade at $1.19683 – its strongest against the greenback since January 2015. The dollar had slumped against a basket of global currencies on Friday and remained weak in the first trading of the new week due to falling expectations of a rate hike later this year.
Speaking at the annual central bankers’ meeting in Jackson Hole, Wyoming, Federal Reserve chair Janet Yellen last Friday avoided talking about monetary policy. Instead, she defended rules adopted in response to the financial crisis, reiterating that any rollback of post-crisis financial reforms should be “modest”. Yellen’s comments sparked uncertainty as to whether the central bank will raise rates one more time or unwind the central bank’s balance sheet later this year.
Meanwhile, European Central Bank President Mario Draghi at Jackson Hole also avoided giving fresh clue on when the bank might tighten its stimulus program. However, he claimed that the recovery in the euro area was gaining momentum.
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