Investors’ expectations of a looser monetary policy from the European Central Bank are continuing to grow and weighing on the Euro in Asian trade. Also, though there is calm following the announcement of the outcome of a Ukraine presidential election and as European Parliamentary votes are counted with a likely move toward the Eurosceptic party in France, analysts say that there could still be some inherent negativity for the common currency as well as the Pound Sterling.
Since May 5th, the EUR/USD had lost nearly 2%, and that is primarily attributed to a likely change in bias by the ECB. As reported at 10:38 a.m. (JST) in Tokyo, the EUR/USD was trading at $1.3629, just a few pips from Friday’s peak in New York at $1.3631; the pair fell as low as $1.3615 during the Asian session, while the EUR/JPY had eased to 138.96 Yen. On Friday, the U.S. Dollar Index crept higher to a 6-week peak at 80.443 .DXY but has been able to maintain that level given the continued pressure on the Euro as one of the components in the weighted bucket of currencies.
Draghi Speech Eyed
Analysts say that markets will be refocusing on the European Central Bank’s policy meeting on Thursday, and will be especially keen to hear Mario Draghi’s speech afterward, to get a better sense of the ECB’s intent.