The euro unexpectedly jumped today even as fundamentals in Europe were not supportive for the currency. The likely cause for the rally was the release of the Federal Reserve minutes that showed probability of additional quantitative easing.
The Federal Open Market Committee released the minutes of its last monetary policy meeting. The minutes showed that some policy makers considered additional stimulating measures:
Looking ahead, a number of participants indicated that additional asset purchases would likely be appropriate next year after the conclusion of the maturity extension program in order to achieve a substantial improvement in the labor market.
As for Europe itself, it did not give a reason to be bullish on the euro. Industrial production in the eurozone dropped 2.5 percent in September on a seasonally adjusted basis. Tomorrow’s data is expected to show French economic growth stalled, while the German economy expanded by meager 0.1 percent.
EUR/USD advanced from 1.2702 to 1.2736 as of 23:25 GMT today and its daily high was at 1.2777. EUR/JPY surged from 100.82 to 102.13 and EUR/GBP jumped from 0.8002 to 0.8037.
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