By: Barbara Zigah
Unexpectedly dismal trade data from China has sent the Euro lower against the U.S. Dollar, and market players expect that the common currency will continue to sink throughout the day. As reported at 1:33 p.m. (JST) in Tokyo, the Euro was trading lower against the greenback, at $1.3868, off from yesterday’s late trading in New York of $1.3907. Investors are expecting the Euro perhaps to slip as far as $1.3800. The Euro was also lower against the Japanese Yen, trading at 114.88 Yen, down from New York’s trade of 115.06 Yen.
Some analysts attribute the poor showing of Chinese exports, which rose in February by only 2.4% as compared to the staggering 37.7% gain in January, as the fault of the Chinese Lunar New Year. Meanwhile, analysts had predicted a 25.9% gain on exports for the month.
Weak economic growth in China is generally seen as negative to the overall global recovery. If analysts are correct in their assessment that the Chinese holiday was the cause of the export contraction, then the implication suggests that export figures for March should rebound.
The common currency was already under pressure with diminished risk appetite, following the worse-than-expected labor data from Australia, and news that the New Zealand central bank lowered its cash rate to 2.50% from 3.0%.