The dollar received another reason for growth and jumped above the five-week high against the euro after the head of the European Central Bank, Mario Draghi, said that economic risks shifted to the downside, and short-term data is likely to be weaker than previously thought.
Recall, the ECB left its monetary policy unchanged, as expected, maintaining the intention to raise rates at the end of this year, even though the eurozone economy is experiencing the most serious slowdown in the last half-century. The euro fell 0.45 percent against the dollar and is trading at 1.1329 dollars. Those who have only recently predicted the strengthening of the single European currency to $ 1.2 will be advised to be patient, perhaps for the next two years.
While the euro-optimists are preparing for a breakthrough, the European currency fell to 1.1308 dollars, the weakest exchange rate since December 17. The dollar index, which tracks the dollar against the euro, the yen, sterling, and three other currencies, rose by 0.33 percent, to 96.439 percentage points.
Even after the recent fall and the generally tense situation on the global financial arena, the dollar remains a tough nut to crack. Fundamental indicators do say that the "American" is overbought and overvalued, but even in this situation, there is no alternative to the dollar. Other major currencies, with the exception of the yen, are under even more serious pressure, which means the dollar will continue to stay on top.
The material has been provided by InstaForex Company - www.instaforex.com