The Euro continued to fight to gain traction against its U.S. counterpart, the aftereffects of dovish comments made by several officials of the European Central Bank. Even the German Bundesbank’s chief, who had initially been critical of the ECB’s monetary policy, appears to have switched allegiance in favor of additional easing. Traders will keenly watch Monday’s release of Eurozone inflation data to glean any hints on where Mario Draghi might take the ECB at the next policy meeting.
As reported at 11:55 a.m. (JST) in Tokyo, the EUR/USD pair traded at $1.3744, edging away from an overnight low of $1.3728 but still poised to end the week with a second consecutive decline. The EUR/JPY also crept up from its 3-week trough at 140.19 Yen to trade recently at 140.41 Yen.
Kiwi Surges on Policy Shift Speculation
The New Zealand Dollar, also known as the Kiwi, surged to multi year peaks against its two safe haven rivals, the Japanese Yen and the U.S. Dollar as investors speculate that the Reserve Bank of New Zealand is on the verge of a monetary policy change. Earlier this month, the RBNZ hiked interest rates and indicated a shift toward monetary tightening, a policy shift that is far ahead of essentially over other major central bank. As a result, the New Zealand Dollar has been among currencies best performers in the last several months, with the NZD/USD recently striking a 2½ year peak at $0.8697.