Bloomberg (May 12)
“The euro short-term rate, or ESTR, is currently 10.5 basis points below the central bank’s deposit rate, which is at its highest in 15 years. That’s close to the biggest gap on record…. It’s a sign the ECB’s aggressive rate hikes aren’t rippling out to banks and the economy, making it much harder for the central bank to meet its 2% inflation target.”
Tags: Aggressive, Banks, Deposit rate, ECB, Economy, ESTR, euro, Gap, Inflation target, Rate hikes, Record, Rippling out
Wall Street Journal (November 1)
The European Union’s statistics agency released figures that surprised most economists. “Consumer prices were 10.7% higher in October than a year earlier.” This marks “the fastest rate of increase since records began in 1997, two years before the euro was launched,” while at the national level “Germany’s measure of inflation was the highest since December 1951.”
Tags: 10.7%, 1997, Consumer prices, Economists, EU, euro, Fastest, Germany, Highest, Increase, Inflation, October, Records, Statistics agency, Surprised
Financial Times (September 5)
“The euro dropped on Monday to a new 20-year low after Russia’s decision to shut a major gas pipeline to Europe intensified the energy crisis that has dealt a heavy blow to the region’s economy.” The currency blew past parity, going as low as $0.988 in London. Stocks fell and energy prices surged while “European capitals struggle to contain growing concerns over Russia’s ‘weaponisation’ of gas supplies.”
Tags: $0.988, 20-year low, Blow, Currency, Economy, Energy crisis, Energy prices, euro, Europe, Gas, London, Parity, Pipeline, Russia, Shut, Stocks, Surged, Weaponisation
Reuters (July 14)
“After staring parity against the dollar in the face for days, the euro finally broke the key level.” The immediate cause was surging U.S. inflation, which strengthens “the case for a supersized 100 bps rate hike by the Federal Reserve” should it choose to follow the Bank of Canada, which “paved the way” with “the first 100-basis-point rate increase among the world’s advanced economies in the current policy-tightening cycle.”
Tags: 100 bps, Advanced economies, Bank of Canada, Dollar, euro, Fed, Inflation, Parity, Policy-tightening cycle, Rate hike, Surging, U.S.
New York Times (May 21)
“The euro hasn’t fallen below the one-to-one exchange rate with the U.S. dollar for two decades. But as economic risks grow, more analysts predict deeper lows for the shared currency.” The U.S. currency is considered one of the safest havens “for money as the risk of stagflation — an unhealthy mix of stagnant economic growth and rapid inflation — stalks the globe.”
Tags: Analysts, Currency, Dollar, Economic risks, euro, Exchange rate, Growth, Havens, Money, Stagflation, Stagnant, U.S., Unhealthy
The Guardian (August 13)
“Forget doom-laden headlines, the dollar has not gone into terminal decline.” In fact, the dollar’s resiliency has been upheld even though “Donald Trump’s administration has done more than any in living memory to disrupt US trade” and has transformed the nation into an unreliable alliance partner. And yet, “the currency’s international role has not diminished significantly.” The simple truth is “there is no alternative. The euro is not an alternative…. Nor is the yuan a viable alternative.”
Tags: Alliance partner, Alternative, Currency, Decline, Diminished, Disrupt, Dollar, Doom, euro, Resiliency, Trade, Trump, U.S., Unreliable, Yuan
Bloomberg (October 24)
“Don’t let Italy off the hook. The euro area needs budget rules, and the European Commission is right to enforce them…. The euro area has a strong collective interest in each member’s willingness to maintain fiscal discipline.”
Tags: Budget rules, Collective interest, Enforce, euro, European Commission, Fiscal discipline, Italy
Forbes (February 6)
“The dollar-euro exchange rate is the most important price in the world…. How so? These are two surpassingly large economic areas, and they trade and invest more than enough with each other—such that each imports the other’s entire relative price structure…. Change that exchange rate in a big way—a fifth is plenty big—and all sorts of new decisions will come in terms of where one plans to invest, produce, and sell.”
Tags: Dollar, euro, Exchange rate, Imports, Invest, Price structure, Produce, Sell, Trade
Washington Post (February 8)
“It is said that the European Union is a splendid idea but that the euro — the common currency — is a bad idea. Actually, the euro is a bad idea that is the logical application of an even worse idea — the European Union.”
Institutional Investor (November 12)
“So far all comments from ECB policymakers have raised dovish expectations for the December meeting, while in the U.S. the Federal Reserve is widely expected to begin tightening. As a result, many analysts now see the macro setup for the dollar versus the euro as a catalyst to retest levels reached in the spring.”
Tags: Analysts, Catalyst, Dollar, Dovish, ECB, euro, Expectations, Fed, Policymakers, Tightening, U.S.
