The community currency weakens 1% in the week
MADRID, June 14 (EUROPA PRESS) –
On Friday afternoon, the euro registered a depreciation of 0.62% against the dollar, reaching 1,067 ‘greenbacks’, the lowest levels seen six weeks ago in a context marked by the monetary policy meeting of the Federal Reserve ( Fed) and the notable corrections in European stock markets following the results of the elections on the continent.
According to market data consulted by Europa Press, the euro accumulated a depreciation of 1% this week against the US currency.
The euro started the month of June at around 1.09 dollars and maintained that level practically unchanged throughout the first week of the month despite the fact that the European Central Bank (ECB) began the cycle of cuts in the rates last week. interest rates by a quarter point decrease.
The ‘guardian of the euro’ has tried to convey the message that there is no fixed schedule of cuts and that decisions will be made meeting by meeting, although the market consensus expects two additional rate cuts in the remainder of 2024.
Going into the details of this week, the price of the euro has already registered movements in the form of falls due to the Fed meeting, which kept the ‘price of money’ in the range of 5.25-5.5%, and the European political context marked by the elections to the European Parliament, which in turn have led to the call for early elections for the French legislative chamber.
Linked to this last point, the European stock markets have recorded considerable losses this week, exceeding 6% in the case of the main indicator of the French market, the CAC 40.
Back with the Fed, the organization established after its meeting this past Wednesday that they only plan to cut rates for the remainder of the year.
“Our base hypothesis is that there will be no cuts this year [por parte de la Fed]but if the progress of inflation continues during the summer months or the labor markets begin to show some signs of tension, we do see the probability of there being one increase,” experts from the management company Fidelity have argued.
The different rhythms and times between the ECB and the Fed, which until now had maintained coordination in monetary policy, will affect the relationship between currencies and public returns, market analysts have recalled.
