The euro was affected towards the end of this week’s session as U.S. consumer sentiment declined, raising risk aversion among traders which opted mostly for the yen and the dollar to protect their assets.
The euro closed this week nearly neutral from its opening price 5 days ago versus the greenback as multiple factors caused a high volatility for the Eurozone currency. This Friday, unexpected reports moved markets and two of the main European Union countries, France and Germany, posted a surprising growth of 0.3 percent for their economies, helping the sentiment towards the economic recovery in the region to rise, supporting the euro. Hours later, a U.S. consumer confidence report posted negative figures beyond the expectations, slashing the Eurozone currency previous gains, making its price to be virtually neutral in the weekly comparison versus the greenback, and posting a significant loss of 2.5 percent versus the yen.
Even if GDP figures are highly significant for a currency outlook, risk levels in trading markets still beyond average, which is providing support for refuge currencies like the yen to climb. Despite Germany’s importance in the EU economic scenario, other countries in a less favorable condition are weighing on the euro outlook, decreasing attractiveness for the 16-members common currency.
EUR/USD closed at 1.4199 from 1.4188 in the beginning of the week. EUR/JPY traded at 134.68 from 138.55
If you have any questions, comments or opinions regarding the Euro,
feel free to post them using the commentary form below.