Euro Falls After ECB's François Villeroy Calls For Sustained Stimulus
22 Mars 2017 - 8:37AM
RTTF2
The euro declined against its major counterparts in the European
session on Wednesday, as the Bank of France Chief François Villeroy
de Galhau argued that the appropriate time for the winding down of
stimulus measures has not yet been reached and the European Central
Bank should continue accommodative monetary policy to progress
towards inflation goal.
"Without monetary stimulus, the recovery in inflation would not
yet be self-sustained or durable throughout the euro area,"
Villeroy told a business conference in Frankfurt.
"That is why we are maintaining an accommodative stance while
adapting its intensity."
The bank's stimulus measure are working well, with both headline
and underlying inflation expected to converge close to the target
in 2019.
"Given this progress, should we stop pursuing an accommodative
monetary policy? At this stage, the answer is clearly no," Villeroy
added.
The currency was also weighed by worries about whether President
Donald Trump will be able to deliver his promises on reforming
regulations, increasing infrastructure spending and lowering
corporate taxes.
Trump told House Republicans Tuesday that they could lose
re-election in the 2018 midterms if they vote against the GOP
health care bill planned for Thursday. It is feared that a failure
to approve the Obamacare replacement plan could endanger more of
Trump's legislative and policy agenda.
Data from the European Central Bank showed that the euro area
current account surplus declined to a 15-month low in January.
The current account surplus fell to EUR 24.1 billion in January
from EUR 30.8 billion in December. This was the lowest since
October 2015, when the surplus totaled EUR 23.4 billion.
The euro held steady against its major rivals in the Asian
session, with the exception of the yen.
The euro reversed from an early high of 1.0776 against the
greenback, edging down to 1.0776. The euro is poised to target
support around the 1.06 region.
The euro fell to a 3-week low of 119.79 against the yen, 5-day
low of 1.0706 against the franc and more than a 2-week low of
0.8643 against the pound, off its early highs of 120.84, 1.0746 and
0.8669, respectively. The next possible support for the euro may be
found around 119.00 against the yen, 1.06 against the franc and
0.85 against the pound.
The 19-currency retreated to 1.4073 against the aussie, from an
early 9-day high of 1.4117. On the downside, 1.39 is possibly seen
as the next support level for the euro.
Looking ahead, U.S. house price index for January and existing
home sales for February are set for release in the New York
session.
At 3:45 pm ET, the Bank of Canada Deputy Governor Lawrence
Schembri speaks about business investment and the economic outlook
at the Greater Vancouver Board of Trade.
Euro vs Yen (FX:EURJPY)
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Euro vs Yen (FX:EURJPY)
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De Avr 2023 à Avr 2024