That is why the euro exchange rate shows little movement | 02/23/21

The euro rate barely moved in late US currency trading on Tuesday.

Most recently, the European common currency, the euro, was quoted at 1.2145 US dollars. In the early European currency business, it had tied the previous day’s profits and had risen to $ 1.2180. The European Central Bank (ECB) had set the reference rate at 1.2143 (Monday: 1.2133) dollars. The dollar had thus cost 0.8235 (0.8242) euros.

Statements by US Federal Reserve Chairman Jerome Powell initially did not change the direction of the exchange rate. He confirmed recent statements. Accordingly, there is still a long way to go before the US economy has overcome the consequences of the corona crisis and achieved the goals of the central bank. The outlook has improved thanks to the vaccinations, Powell said. Fears of an overheating economy and rising inflation have recently increased. The fears are also fed by the US government’s planned stimulus package worth billions.

Powell doesn’t see these inflation threats, however. He points to the increased unemployment and the weakened recovery on the labor market. “The top US central banker remains true to his cautious line with a view to assessing the economic outlook,” commented Uwe Burkert, chief economist at LBBW. The advancing economic recovery should therefore not be threatened by changes in monetary policy for a long time to come.

The pound sterling rose significantly against all major currencies. Against the euro it has reached its highest level in almost a year. The UK government plans to lift all restrictions on the coronavirus pandemic in England by June 21. “In the short term, the British currency is likely to continue to have the lead in the G10 comparison,” said Thu Lan Nguyen, foreign exchange expert at Commerzbank. However, it is questionable how much more appreciation the British central bank will tolerate.

/ bek / he

NEW YORK (dpa-AFX)

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