Euro-Dollar Rides Wave of Stimulus to 12-Week Highs

© Reuters.

By Yasin Ebrahim – The euro rose to a 12-week high against the dollar Thursday after the European Central Bank’s bold stimulus measures stoked hopes the eurozone could emerge from the Covid-19 recession quicker than many expect.

rose 1.03% $1.0348.

The European Central Bank said Thursday it will increase its pandemic bond buying program by €600 billion ($681 billion) in an effort to cushion the economic blow from the coronavirus pandemic.

The move was “stronger and sooner than markets anticipated,” said Esty Dwek, head of market strategy at Natixis Investment Solutions. But should “keep yields low and spreads contained,” supporting the recent rally of European assets, Dwek added.

The expansion in monetary stimulus comes as the EU proposed a €750 billion coronavirus fiscal rescue plan, which, if approved by member states, will support some of the hardest-hit regions in the bloc.

The steps forward on a fiscal stimulus package combined with the ECB’s rapid policy response could see the eurozone recover more quickly from the Covid-19 recession than the U.S. and U.K., J.P. Morgan Asset Management said.

Euro area activity is “expected to rebound in the third quarter as the containment measures are eased further, supported by favorable financing conditions, an expansionary fiscal stance, and a resumption in global activity,” ECB President Christine Lagarde said Thursday.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.

Source: Euro-Dollar Rides Wave of Stimulus to 12-Week Highs

Spread the love

Related Articles

Leave a Reply

Our website uses cookies and thereby collects information about your visit to improve our website (by analyzing), show you Social Media content and relevant advertisements. Please see our cookies page for furher details or agree by clicking the 'Accept' button.