Currency: the euro is able to hold on its own

(ABM FN-Dow Jones) The Euro was still steady above $ 1.20 on Friday, after the European Central Bank showed it is ready to expand on Thursday, but not enough to bring the Euro below that level.

“The bank knows that the economic outlook will be back on the agenda in June,” Georgette Boeli, a currency specialist at Bank ABN Amro, told ABM Financial News on Friday. “In the lead up to that, it is important for the European Central Bank to coordinate monetary policy accordingly,” Boyle said.

The surprise came not from the European Central Bank this week, but from the Bank of Canada, which indicated on Wednesday that it will buy less. “This feeds expectations that Canadians will come out with a rate hike before the Federal Reserve,” said ABN AMRO currency expert on Friday.

Boele does not rule out that the EURUSD bid is partly linked to the tax plans of the White House, which wants to increase the capital gains tax for wealthy Americans from 20 to 39.6%. “Equity markets didn’t like them that much, and the dollar might be affected as well,” Boyle said.

For Boele, after reasonable to good PMIs from Japan and the euro zone, attention is focused next week, when the Federal Reserve holds a policy meeting. It expects Chairman Jerome Powell to repeat his message, which is that interest rates will not rise until 2023. In addition, the first estimate of US economic growth will be published in the first quarter.

The Japanese showed further growth with the PMI for April. Later in the morning, the same was true of the French, British and Eurozone economies. German economic activity increased at a slower pace.

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The British also announced an increase in retail sales for March on Friday, which was stronger than expected.

Calm reigns in the US today with only new home sales for the month of March and preliminary PMIs.

European Central Bank President Christine Lagarde will participate in a panel hosted by Michael Bloomberg on Friday.

The euro rose 0.4 percent on Friday to $ 1.2059. The European currency rose 0.1 percent to 0.8690 pounds. The British pound rose 0.2 percent on Friday to trade at $ 1.3874. The dollar was trading unchanged at 6.4932 CNY. The dollar also settled today at 107.9195 yen.

ABM Financial News; [email protected]; Revised text: +31 (0) 20 26 28999.

From Beursplein 5, eds ABM Financial News Developments on stock exchanges, and the Amsterdam Stock Exchange in particular, are closely watched. The information in this column is not intended as professional investment advice or as a recommendation to make specific investments.

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