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US economic risks let Euro to gain one-year peak

April 27, 2023 at 3:04 pm | Economic Affairs

April, 27(Agencies)—Euro hovered near a one-year high versus the dollar on Thursday, as Europe’s resilient economy contrasted with banking contagion risks in the United States, the debt ceiling standoff and a potential recession.
The risk-sensitive Aussie struggled to stay above the key 66 cent mark, while leading cryptocurrency bitcoin found its footing around $29,400 following wild swings in the previous session.
Yen was in a holding pattern as the Bank of Japan began a two-day policy meeting, the first under new governor Kazuo Ueda.
Europe’s single currency ticked up 0.05% to $1.10415, edging back toward the overnight peak at $1.1096, the highest since April of last year.
The dollar index – which measures the greenback against six major peers, with the euro the most heavily weighted – was little changed at 101.41, following a 0.42% slide on Wednesday, when it touched a near two-week low of 101.00.
Germany again revised up growth forecasts on Wednesday, and a survey showed a continued pickup in consumer confidence.
By contrast, US capital goods spending fell more than expected in the latest data overnight, adding to jitters about a downturn.
The mood wasn’t helped by First Republic Bank’s continued slump, or the continued wrangling over an extension to the US debt ceiling.
“The resilient euro zone economy alongside underlying inflation that is still going up and not down can see the ECB maintain their hawkish stance, supporting EUR,” Kristina Clifton, senior currency strategist at Commonwealth Bank of Australia, wrote in a client note.

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