Draghi Outlook Sends Euro Spiraling

The Euro remained on the defensive during Friday’s Asian trading, in an attempt to recover from the losses incurred after Mario Draghi, the head of the European Central Bank, said that a monetary policy change might soon occur in order to halt declining inflation. He also pointed out that the Euro’s strength remained a concern to the board members, which suggested that easing was a likely possibility, perhaps even by June. The ECB’s official policy decision, however, was to maintain the status quo for the time being. A recent poll suggested that analysts feel the ECB will act only when and if the EUR/USD approaches the $1.40 level.

As reported at 11:26 a.m. (JST) in Tokyo, the EUR/USD pair was holding at $1.3843, pulling away from the 2½ year of $1.3992 struck just after the ECB policy decision but before the Draghi offered up his own outlook at the subsequent press conference.

Yen Gains Support

In the U.S., dovish comments recently made by several Federal Reserve members helped to renew the pressure on the U.S. Dollar and to keep U.S. Treasury yields suppressed. As a result, the go-to currency in the overnight hours was the Japanese Yen, which also found support from the continuance of tensions in Ukraine. The USD/JPY pair traded at 101.615 Yen, a loss of nearly 0.55% for the week.