US Dollar Moves Higher Against Euro Following Draghi’s Dovish Comments

The US dollar rose against the euro and a basket of other major peers on Monday, as investors expected the greenback to get closer to parity with the shared currency. European Central Bank President Mario Draghi made a statement today that delivered a dovish outlook for the central bank’s monetary policy.

The US currency managed to rise despite uncertainty towards President Donald Trump, as a number of decisions he made raised concerns towards geopolitical stability and US trade relationships. The worries, which are limiting the dollar’s gains, are expected to be the main feature of Trump’s first months in presidency.

Meanwhile in Europe, the European Central Bank president spoke earlier today in front of the ECON committee of the European Parliament in Brussels. During his speech, Mario Draghi said that even though the economic conditions in Europe are improving, the Eurozone’s economy is not yet ready for a reduction of monetary stimulus.

Draghi added that recent increases in inflation do not reflect better economic conditions, but rather the recovery of energy prices over the past months, highlighting that core inflation is still too low. The euro declined following Draghi’s comments.

EUR/USD traded at 1.0743 as of 19:05 GMT on Monday, after touching 1.0708 at 14:05 GMT, the pair’s lowest level since January 31. EUR/USD opened trading today at 1.0781.

The Dollar Index, which measures the performance of the US currency against a basket of its major peers, moved to 99.95 as of 18:58 GMT, from 99.86 on Friday.

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