The Euro had only a brief moment in the sun last week as ECB President Mario Draghi announced that the bank would be lowering its monthly asset purchases from €80bn to €60bn a month. However, the single currency plummeted shortly thereafter when Draghi said that the bank would be extending its stimulus package until December 2017 to boost Eurozone growth.
‘There are indications of a somewhat stronger global recovery. However, economic growth in the Euro area is expected to be dampened by a sluggish pace of implementation of structural reforms and remaining balance sheet adjustments in a number of sectors,’ he said.
Worse-than-expected trade balance data in Germany added to the pressure on the euro on Friday. This was mainly attributed to German exports, which fell short of the expected 0.9%.
The single currency is under pressure, the Eurozone news flow is poor and it will be interesting to see what effect the US interest rate decision will have on the EUR/USD and hence the GBP/EUR currency pairs.