Euro had a mixed week amid concerns over the Italian Government and comments from Mario Draghi
By Smart Currency October 4th, 2013
The euro has experienced mixed fortunes this week as we saw considerable volatility in major pairings. The single currency has continued to appreciate against the US dollar this week, surpassing the notable level of 1.36. This movement was largely thanks to European Central Bank President Mario Draghi’s speech on Wednesday. Contrary to some predictions, he did not refer to a further Long-Term Refinancing Operation (LTRO) and seemed unperturbed by the single currency’s continual strengthening against the US dollar over recent months. The seventeen-nation currency saw a more variable performance against sterling. Sterling edged close to the key 1.20 level, before cascading rapidly from lunchtime on Wednesday onwards. The euro also gained support during the latter parts of the week as Sylvio Berlusconi reneged on his promise to topple the Italian Government when it was revealed that a number of his influential ministers would not walk out. This led to Italian premier Enrico Letta comfortably winning the vote of confidence, bringing more stability to the region. Eurozone data releases this week have been mixed and had little effect on the markets, leaving the two aforementioned influences to steal the limelight. Looking ahead to today, it is likely that market chatter and events elsewhere will drive market movements, although the early morning release of German producer price index figures – which are key inflation indicators – may have some impact. Call your trader now to see if the single currency can maintain its late-week surge.