Weekly currency analysis: The ECB will not strengthen the euro

Weekly currency analysis: The ECB will not Strengthen the euro

Analysis Department of Bankinter offers its forecasts for the next behavior currencies:

Eurodollar (€ / USD)

The euro depreciated from 1.24 to 1.23 over the past week as a result of increases IRRs (the TNote approaching 3%).

This week the focus will be on the meeting of the European Central Bank (ECB) . We do not think it will alter your message. No clues on the steps of the exit strategy, the euro should not be strengthened so that the crossing could slip more downward. 

Estimated range (week): 1,218 / 1,235.

Euroyen (€ / JPY)

Despite the vagaries of the market, the yen closed the week at tables (132) .

For the next few days, we think – but resists – and l yen should depreciate something , because the expected decline Tokyo CPI (April + 0.8% estimated) corroborates the loss of momentum in the country’s inflation (CPI March + 1.1% from 1.5% in February). So that the meeting of the Bank of Japan (BoJ) (V) serve to neutralize a hypothetical  scenario (in our opinion, highly unlikely) reduction of monetary stimulus in Japan. 

Estimated range (week): 132.1 / 133.9.

Eurolibra (€ / GBP)

Pound traded lower after reaching the British March CPI the lowest level in 12 months (+ 2.5% vs. + 2.7% previously). The deteriorating macro (Retail Sales, Wages, Prices Real Estate …) reduces the probability of seeing a rise in interest rates in the short term.

This week the focus will be on GDP growth in the first quarter 2018

Estimated range (week): 0.876 / 0.882.

Eurosuizo (€ / CHF)

The strategy of the Swiss National Bank (SNB) to bet on a weak currency works and the franc reaches minimum of three years in an environment of lower market volatility. On the macro front, no significant changes in the main indicators of Switzerland .

This week the focus will be on the Swiss trade balance. 

Estimated range (week): 1,193 / 1,200.


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