The EUR/USD hit a 2-week peak during trade in London as FX traders resumed their purchases of risky European assets on expectations that Eurozone growth is likely to remain strong, in spite of a low rate environment. Mario Draghi, the head of the European Central Bank, had earlier made just that case. FX strategists say that, as a result, the Euro’s future is looking robust and consequently, investors are becoming more hopeful. Some economic data could help solidify that outlook; preliminary Q3 GDP figures for the Eurozone showed growth of 2.5% (year-over-year) and 0.6% (quarter-over-quarter), meeting analysts’ forecasts.
As reported at 11:04 am (GMT) in London, the EUR/USD was trading at $1.1719, a gain of 0.46% and slipping off the earlier peak of $1.17253. The EUR/GBP is also higher at 0.8952 Pence, a gain of 0.64%; the pair has ranged from a session trough of 0.8880 Pence to a peak of 0.89540 Pence.
Central Bank Heads in Focus
Markets are due to turn their focus to Frankfurt later today where the heads of several of the world’s major central banks will be meeting to discuss central bank communications. The Federal Reserve, Bank of England and Bank of Japan will be hosted by the European Central Bank. One FX analyst says that while most currency pairs are trading within ranges, it’s not impossible that today’s discussion in Frankfurt could result in one currency or one pair’s movement as a result.