The euro remained steady against the dollar today as traders shrugged off the possibility of intervention by the European Central Bank.
The 18-nation currency advanced 0.1 percent to $1.3862, after earlier touching a low of $1.3815 on Monday. The euro was also up 0.1 percent at 142.10 yen, which is higher than Monday’s weekly low of 140.99. The U.S. dollar remained firm at 102.50 yen.
Trading activity today was lighter as Japanese markets were closed for a public holiday today.
The euro was boosted by ECB’s President Mario Draghi’s comments to German legislators that the central bank is still far off from rolling out quantitative easing measures despite the stubborn deflation. Another key ECB official Vice President Victor Constancio told press in Frankfurt that euro zone April’s inflation figures that will be released this week aren’t sufficient to influence policy moves.
Germany’s inflation results for April are due to be announced today. ECB statistics office will release the economic bloc’s figures on Wednesday.
“If the German price data fails to show any improvement, this would immediately raise expectations for an ECB easing as soon as May 8, and hurt the euro,” wrote BNP Paribas’ analysts, according to Reuters.
The pound remained stable at $1.6814, down from its four-and-half year high on Monday of $1.6858 that was mostly attributed to the mergers and acquisitions wave. U.S. pharmaceutical firm Pfizer expressed intention to buyout U.K. rival AstraZeneca for at least $100 billion.
The market is keenly monitoring the Ukraine crisis, which is blamed for causing forex market volatility, after U.S. imposed new sanctions on Russian entities and influential officials. Its EU allies are debating how to do so without derailing their own economies. To register for a free 2-week subscription to ForexMinute Premium Plan, visit www.forexminute.com/newsletter.
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