Euro Rallies Against US Dollar on Mario Draghi Speech

The euro today rallied briefly against the US dollar after Mario Draghi‘s speech at the second annual conference of the European Systemic Risk Board in Frankfurt. The EUR/USD currency pair was on a recovery mode throughout today’s session after a major decline triggered by yesterday’s FOMC rate decision.

The EUR/USD currency pair was on a recovery path today gaining about 74 points at the height of its rally as the euro gained against the US dollar.

Some of the triggers for the currency pair’s initial rally include a GMS poll that indicated Angela Merkel‘s Conservatives would win 37% of the Bundestag seats. The European Central Bank also published its economic bulletin, which expressed confidence in the EU economies. Mario Draghi’s speech in Frankfurt also boosted the single currency as he reiterated that monetary policies were not the right tools to address financial imbalances. The positive Eurozone consumer confidence data released today also boosted the euro.

The US dollar was under pressure today mainly from the euro even as the US Dollar Index was forced to give up some of yesterday’s gains from a high of 92.70 to trade around 92.00 today. US releases such as the positive initial jobless claims data and the Philly Fed manufacturing index, both of which surpassed estimates, could not rescue the greenback.

The currency pair’s future performance is likely to be affected by the release of both the Markit Eurozone and US Manufacturing PMIs, scheduled for tomorrow.

The EUR/USD currency pair was trading at 1.1931 as at 15:31 GMT having rallied from a daily low of 1.1865. The EUR/JPY currency pair was trading at 134.03 having risen from a low of 133.51 earlier today.

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