Forex traders are seeing that the ECB is really serious about stimulus, and the result is that euro weakness, after threatening for months, finally seems to be appearing on a more long-term basis. Euro is down against its major counterparts today, noticeably dropping through the 1.3500 level against the US dollar.
Euro is mostly down today, dropping against its major counterparts due to a combination of risk aversion and efforts by the European policymakers to stimulate the eurozone economy.
In recent the months, ECB President Mario Draghi has been outspoken about possibilities designed to ease the euro and stimulate the eurozone’s economy. The ECB has already announced negative deposit rates, and asset purchases are on the table. These measures are designed to weaken the euro, and they have been working slowly, but things finally seem to be moving in that direction. It is clear that policymakers are serious about stimulus, and Forex traders are heeding that.
Also weighing on the euro are concerns about world politics. The Middle East isn’t that far from the eurozone, and concerns that more sanctions against Russia over Ukraine are also weighing on the euro.
At 13:59 GMT EUR/USD is down to 1.3470 from the open at 1.3523. EUR/GBP is down to 0.7892 from the open at 0.7920. EUR/JPY is down to 136.6695 from the open at 137.1250.
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