The euro fell on Thursday. How does the dollar do?
Today’s drop in the value of the euro against the greenback was a sign that the common currency is falling. New data has shown that the euro area inflation was lower than traders expected. That means there’s less chance for the European Central bank to hike interest rates. Although declining inflation is good news for the euro, it sent the currency into bearish territory.
According to the report, euro area inflation dropped to 8.5% last month from January’s 8.6% reading. This was due to lower energy prices. But it’s still higher than the 8.2% predicted. Despite the euro’s decline, investors’ reaction to the data wasn’t very strong.
On Wednesday, the single currency saw a 0.9% increase against the dollar. This was its highest point for a month. Prices in German soared more than expected last month, along with France’s and Spain’s inflation. This news encouraged traders’ hopes about further ECB rate hikes, supporting the euro.
Ben Laidler of Etoro London was the Global Markets Strategist. He noted that inflation was much higher than expected, but perhaps not as serious as some had feared, as expectations had changed since the last few days. He thinks the central bank might move with a…