TheÂ euro today traded slightly lower against theÂ US dollar following comments byÂ some members ofÂ theÂ European Central Bank‘s governing council. TheÂ dovish comments byÂ Ewald Nowotny andÂ Villeroy triggered aÂ knee-jerk reaction byÂ theÂ EUR/USD currency pair, which headed lower.
TheÂ EUR/USD currency pair today declined from aÂ high ofÂ 1.1592 toÂ aÂ low ofÂ 1.1538 inÂ theÂ mid-European session following theÂ dovish comments.
TheÂ release ofÂ theÂ German producer price index forÂ May byÂ theÂ Federal Statistical Office early inÂ theÂ European session had aÂ muted impact onÂ theÂ currency pair. TheÂ PPI came inÂ atÂ aÂ monthly 0.5% versus theÂ expected 0.4% translating into anÂ annualized 2.7%. Nowotny jawboned theÂ euro byÂ stating that he expects theÂ euro toÂ decline against theÂ US dollar, while Francois Villeroy de Galhau stated that he does not see aÂ rate hike byÂ theÂ ECB until theÂ summer ofÂ 2019. TheÂ currency pair quickly recovered from theÂ dip following aÂ recovery inÂ German 10-year bund yields given, which had hit aÂ 3-week low yesterday, atÂ theÂ peak ofÂ theÂ risk-off sentiment.
TheÂ currency pair was still weighed down byÂ theÂ slightly risk-off market sentiment due toÂ theÂ US-China trade spat. Today’s jawboning added toÂ yesterday’s dovish comments byÂ theÂ ECB President Mario Draghi regarding future rate hikes.
TheÂ currency pair’s short-term performance is likely toÂ be affected byÂ theÂ headlines from theÂ ECB forum inÂ Portugal featuring Mario Draghi, Jerome Powell, andÂ Haruhiko Kuroda.
TheÂ EUR/USD currency pair was trading atÂ 1.1586 asÂ atÂ 12:52 GMT having risen from aÂ low ofÂ 1.1538 earlier today. TheÂ EUR/JPY currency pair was trading atÂ 127.50 having rallied from aÂ low ofÂ 127.09.
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