The euro lost its shine against the US dollar due to strong US economic data and dovish comments from ECB members. It hit a fresh year-low yesterday and is hovering around that level.
Yannis Stournaras from the European Central Bank supports lowering interest rates at every meeting until they reach about 2%. He believes this is needed due to weak economic growth and falling inflation. He thinks it won't quickly raise prices despite strong wage growth, so more rate cuts are essential. Market analysts expect a cut soon, reflecting a general belief that easing monetary policy is necessary to help the economy.
US economic data
For the week ending November 16, initial jobless claims rose slightly to 213,000, which is still lower than expected and shows the stable job market. Continuing claims also increased to 1.908 million, the highest since November 2021. In October, existing home sales rose to 3.96 million units, beating expectations and showing strength in the housing market despite economic challenges.
The Japanese Yen went up yesterday because of comments from Bank of Japan Governor Kazuo Ueda. He hinted that the bank might consider raising interest rates soon, making investors hopeful about an interest rate hike in December.
Markets eye flash manufacturing and services PMI from the UK, German, Euro, and US for furtehr movement.
