Business Express is an online portal that covers the latest developments in the world of business and finance. From startups and entrepreneurship to mergers and acquisitions, Business Express provides reporting on the stories that matter most to business leaders and decision-makers.The website publishes news, press releases, opinion and advertorials on various financial organizations, products and services which are commissioned from various Companies, Organizations, PR agencies, Bloggers etc. These commissioned articles are commercial in nature. This is not to be considered as financial advice and should be considered only for information purposes. It does not reflect the views or opinion of our website and is not to be considered an endorsement or a recommendation. We cannot guarantee the accuracy or applicability of any information provided with respect to your individual or personal circumstances. Please seek Professional advice from a qualified professional before making any financial decisions. We link to various third-party websites, affiliate sales networks, and to our advertising partners websites. When you view or click on certain links available on our articles, our partners may compensate us for displaying the content to you or make a purchase or fill a form. This will not incur any additional charges to you. To make things simpler for you to identity or distinguish advertised or sponsored articles or links, you may consider all articles or links hosted on our site as a commercial article placement. We will not be responsible for any loss you may suffer as a result of any omission or inaccuracy on the website.
2023 01 30T012439Z 1 LYNXMPEJ0T00T RTROPTP 4 GLOBAL FOREX - Business Express

Euro rises after Spanish CPI, dollar slips towards 8-mth low

By Samuel Indyk and Rae Wee

LONDON (Reuters) – The euro rose on Monday after unexpectedly high Spanish inflation data raised expectations for a higher euro area print on Wednesday, while the dollar languished near an eight-month low ahead of a slew of central bank meetings this week.

The euro climbed 0.2% to $1.0891 after data showing Spain’s consumer prices rose 5.8% in January compared with the same month last year, faster than the 5.7% on-year rise recorded in December and the first increase since last July.

“Today’s data will underline expectations for a 50 basis point hike from the ECB on Thursday and also signal that rates will be moved further up,” said Niels Christensen, chief analyst at Nordea.

The U.S. dollar index, which measures the currency against a basket of its peers including the euro, was little changed at 101.88, having hit an eight-month low of 101.50 last week.

It was down more than 1.6% in January and on track for a fourth consecutive monthly loss, pressured by expectations that the Fed is nearing the end of its rate-hike cycle and that interest rates would not have to rise as high as previously feared.

Movements were still relatively subdued ahead of policy meetings at the Fed, the European Central Bank (ECB) and the Bank of England (BoE) later this week.

“The euro has moved higher after the Spanish CPI data, but there’s also risk-off sentiment which should be slightly positive for the dollar,” Nordea’s Christensen said, noting that equity futures were lower in the U.S. and Europe.

“I don’t expect euro-dollar to break higher today or tomorrow ahead of the Fed and ECB,” Christensen added.

The Fed is widely expected to deliver a 25 basis-point rate hike – a shift down from its 50bp and 75bp increases last year – while market watchers say the BoE and ECB are likely to raise rates by 50bps each.

Don't miss out on any breaking news or insightful opinions!
Subscribe to our free newsletter and stay updated on the go!

By submitting this form, you are consenting to receive marketing emails from: Global Banking & Finance Review. You can revoke your consent to receive emails at any time by using the SafeUnsubscribe® link, found at the bottom of every email.

The euro, which is headed for a near 1.7% monthly gain, has drawn support from continued hawkish rhetoric by ECB policymakers and ebbing fears of a deep recession in the euro zone.

Elsewhere, the yen fell 0.3% to 130.195 per dollar after Bank of Japan governor Haruhiko Kuroda on Monday said the central bank must continue its easy policy.

The Australian dollar fell 0.5% to $0.7071 but was on track for a monthly gain of nearly 4%, after Australia’s inflation rate shot to a 33-year high last quarter, causing traders to ramp up bets that the Reserve Bank of Australia will have to tighten interest rates further.

With China returning from its Lunar New Year holiday, focus will be on the upcoming release of its purchasing managers’ index (PMI) data on Tuesday.

“So far, the data coming from China, or the vibes coming from China, do play to the view that a good reopening in terms of activity is likely to unfold,” said Rodrigo Catril, a currency strategist at National Australia Bank.

The onshore yuan jumped against the dollar on Monday, rising roughly 0.5% to 6.7425, as investors cheered signs of economic recovery indicated by robust holiday spending and tourism data.


(Reporting by Samuel Indyk and Susan Mathew in London and Rae Wee in Singapore; Editing by Bradley Perrett, Christopher Cushing and Hugh Lawson)


Recent Post: