Euro is dropping today, falling to a nine-day low against the US dollar as Forex traders consider the disappointing economic outlook for the eurozone. A great deal of the concerns is coming from news out of Germany.
Earlier today, Germany’s central bank cut its economic growth outlook. As the largest economy in the 17-nation eurozone, Germany has a great deal of influence on the performance of the euro. It didn’t help that this revised growth outlook came on the heels of the ECB’s own announcement about a slower economy for the entire eurozone. Even though the ECB kept rates steady, there is speculation that a cut will come sometime early next year.
Some of the sting for today’s euro drop might be eased with the the help of better data out the United States. November payrolls added more jobs than expected, and there might be a corresponding boost to risk appetite that might help the euro a little bit. However, there are still plenty of problems in the eurozone, and enough worry that it’s quite possible that the euro will continue to struggle with some degree of weakness for a while.
At 14:05 GMT EUR/USD is down to 1.2893 from the open at 1.2967. EUR/GBP is down to 0.8053 from the open at 0.8079. EUR/JPY is down to 106.6870 from the open at 106.8850.
If you have any questions, comments or opinions regarding the Euro,
feel free to post them using the commentary form below.