Euro Rallies as Draghi Maintains Status Quo

The common currency Euro held close to Thursday’s 2-month peak versus its main rival, the U.S. Dollar, as FX players show their relief after Mario Draghi and the European Central Bank maintained the status quo on monetary policy. In the customary press conference which followed Draghi said that the existing economic conditions of the Eurozone didn’t warrant any policy shift and that, in fact, the Eurozone was seen as an “island of stability” given the recent turmoil in Ukraine. He cautioned, however, that slowing growth could jeopardize job creation and future prosperity so that the ECB would continue to closely monitor the economic situation.

As reported at 11:24 a.m. (JST) in Tokyo, the EUR/USD was trading at $1.3860, not far from yesterday’s high of $1.3873 which occurred shortly after the monetary policy decision. The EUR/JPY dipped from its 2-month peak at 142.99 Yen to trade at 142.87 Yen while the USD/JPY held at 103.10 Yen, moving away from Monday’s trough at 101.20 Yen.

Dollar Subdued as NFP Looms

Analysts say that the Euro’s gains are likely to be capped in the short term given the somewhat subdued interest in the U.S. Dollar interest as investors await the outcome of today’s release of the very critical Non-farms Payroll report from the U.S. Labor Department. A recent survey of economists concluded that the report could show an uptick in February job growth that would be sufficient for the Federal Reserve to maintain its rollback of economic stimulus.

Barbara Zigah

After working on Wall Street, Barb began her second career as a freelance writer at Daily Forex, where the CEO recognized fresh, untapped potential and was willing to give her a try. She’s never looked back. Since then, she’s worked steadily as a freelance writer and editor in the financial services and Forex-related industry.