Friday, May 23, 2014

Euro lowest level against the dollar

Euro touches its lowest level against the dollar since Feb. 13. ECB President Draghi sparked the common currency's current slump on May 8 with talk about readiness to act at the central bank's June meeting. But the euro's weakness was set long before that, with the Fed tapering QE all while ECB mulled more easing, says Mansoor Mohi-uddin, head of FX strategy at UBS. "The two year shift in the Fed-ECB growth ratio has now reversed," Mohi-uddin says. "The Fed is steadily tapering its asset purchases while LTRO loan repayments are drawing to a close." He forecasts EUR/USD ending the year at 1.25. Euro down 0.2% at $1.3628.