The Swiss franc was the top currency this week, with the euro not too far behind. Both currencies were arguably beneficiaries of a negative leaning risk environment and the European Central Bank, who wasn’t quite ready to talk down the euro’s recent strength.
European Central Bank keeps rates and stimulus program unchanged, despite stronger euro – traders were mainly on the look out to see if the ECB saw the strengthening euro as a deterrent to Europe’s recovery, and which is likely why we saw the euro move higher when the market didn’t get that rhetoric (“The Governing Council discussed the appreciation of the euro, but as you know we don’t target the exchange rate,” ECB President Christine Lagarde).
We saw a broad move higher in both the euro and the Swiss franc during the Tuesday U.S. trading session, which was likely a reaction to the continued U.S. tech sector sell off, prompting traders to rotate from risk assets to safe havens/lower-yielding assets.
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Every day, I will present to you my findings and daily commentaries on what recently happened in the economic arena, possible shifts in sentiment, economic events to watch out for, and their effects on currencies.
When the morning’s freshness has been replaced by the weariness of midday, when the leg muscles give under the strain, the climb seems endless, and suddenly nothing will go quite as you wish – it is then that you must not hesitate.Dag Hammarskjold