Euro continues to struggle, dropping below the 1.30 level against the US dollar today. Concerns about what might be coming are weighing on the 17-nation currency, causing it to lag behind some of its high beta peers.
The European Central Bank is expected to make a policy announcement tomorrow regarding interest rates. Many expect the ECB to keep the benchmark steady, but there is speculation about the future. Forex traders will be listening to Mario Draghi‘s remarks about inflation and economic growth to get an idea of whether or not interest rate cuts could be on the table going forward.
Lately, the eurozone has presented a somewhat mixed bag of data. Recent PMI and retail sales data have been better than expected, but unemployment is still a problem, and there are plenty of concerns related to growth, since the eurozone is still in contraction mode. Recession fears still exist, and they aren’t going away any time soon. And, of course, there is still focus on the political problems in Italy, and Spain is still in the background, with its own issues.
At 15:13 GMT EUR/USD is down to 1.2997 from the open at 1.3051. EUR/GBP is up to 0.8636 from the open at at 0.8629. EUR/JPY is down to 121.6140 from the open at 121.7600.
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