Euro Outshone Dollar But that May Not Last Euro ended last week as the strongest major currency as boosted by a few factors. Firstly, May CPI flash came in higher than expected at 0.3% yoy versus consensus of 0.2% yoy. And, core CPI also jumped 0.9% yoy versus expectation of 0.7% yoy, suggesting that the rebound in inflation was not entirely due to energy prices. Secondly, euro was lifted by surging German bond yields which touched the highest level since September at 0.996% before retreating back to 0.84%. The 36bps weekly gain was the largest since October 1998. Also, recent change in sentiment was rather drastic when taking into considering German yield was a low as 0.49% in back in April. This reflected optimism in improvements in the underlying economy of Eurozone. Thirdly, Greece and international creditors seemed to have entered into another stage of negotiation after EU, ECB and IMF came up with a unified proposal. While there are still many issues to resolve, the negotiations would likely be more focused. Full Report Here... | 
|
No comments:
Post a Comment