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Newsdeck

Euro Climbs to $1.10 For First Time Since August as Dollar Falls

Euro Climbs to $1.10 For First Time Since August as Dollar Falls
A customer counts dollars and euros inside a foreign currency exchange bureau in the Beyoglu district of Istanbul, Turkey, on Thursday, 14 May 2020. (Photo: Kerem Uzel/Bloomberg)

The euro advanced to $1.10 for the first time since August as the dollar sustained its weakening trend.

The common currency was up as much as 0.4% on Tuesday, marking its fourth-straight session of gains. This comes as the Bloomberg Dollar Index suffers its biggest monthly drop in one year, with markets betting the Federal Reserve is finished with its interest-rate hiking cycle.

After nearing parity with the dollar in early October, the euro has rebounded from a low of $1.05 to climb 5%. Yet, currency analysts at firms including ING, JPMorgan and HSBC warn that it is too early to bet on a sustained weakening in the dollar and the euro remains to be vulnerable to paring its recent gains.

Euro Hits $1.10 First Time Since August | Dollar comes under pressure following Fed Governor Waller comments

“EUR/USD should remain almost solely a function of USD moves and Fed rate expectations,” said Francesco Pesole, a FX strategist at ING. “We are not convinced the pair has enough backing on the rates side to trade sustainably above 1.10 and favor instead a correction below 1.0900 in the coming days.”

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