Despite some disappointing investor confidence data from Germany, the euro traded relatively flat yesterday, with the exception against sterling, where we saw euro strength. The result was the weakest sterling level against the euro since late December, mainly due it seems to sterling weakness rather than euro strength. Investors are still keeping their eyes out for any rhetoric from EU officials on the Ukraine crisis as the indications of risk will drive market movements.
Markets are currently confused about how the EU plans to deal with the Crimean issue, given contradicting statements from different states leaked out into the media. For this reason, the market seems to perceive any potential sanctions imposed by the EU as rather unproductive or ‘weak’. A G7 meeting to discuss the issue has been called for next week, and the issue is expected to be looming in the background, closely watched by investors.
Today there are no major releases for the euro-zone. Thus, any movement in the euro against other currencies is expected to be in relation to the other currencies and the economic factors that drive them.
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