Euro Sinks to New Lows Against US Dollar After ECB Minutes

The euro sunk to new lows against the US dollar today after the European Central Bank published the minutes of its September monetary policy meeting. Several releases from the US docket, such as the positive initial jobless claims data, served to drive the EUR/USD currency pair lower.

The EUR/USD currency pair lost about 70 points from its daily high of 1.1781 reached during the early European session to trade at much lower levels.

The currency pair started trending downwards after the ECB minutes indicated that policymakers at the bank were worried about volatility and the euro’s recent rally. ECB board member, Peter Praet advocated for close monitoring of the single currency’s exchange rate. The board also agreed that the Eurozone economies still needed economic stimulus, which highlighted the bank’s dovish outlook. The minutes cast doubt on how soon the ECB might initiate its tapering program.

Several releases from the US docket served to boost the US dollar, as tracked by the US Dollar Index, against the euro. The release of positive initial jobless claims data by the Department of Labor, which came in at 260,000 versus the market consensus of 265,000, also boosted the greenback. The US trade balance for August, released by the Census Bureau, was also positive as it came in at -$42.4 billion as compared to the expected -$42.7 billion.

The currency pair’s future performance is likely to be affected by the release of German factory orders, and US non-farm payrolls and unemployment rate report.

The EUR/USD currency pair was trading at 1.1728 as at 14:35 GMT having dropped from a high of 1.1781 prior to the minutes. The EUR/JPY currency pair was trading at 132.09 having declined from a high of 132.77 earlier today.

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