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The euro crossed the bar $ 1.20 on Monday to hit a new low since March 2006 to 1.1860 dollar. Since 16 December, the euro lost 4.8% of its value against the greenback, after plunging 12% already in 2014. Since its peak reached on March 17 at $ 1.39, it loses even 14 5%. At the time, finance ministers and companies in the area were concerned about a euro too strong and too feeble dollar, carrying the seeds of deflation in the euro area. In April, Mario Draghi, President of the European Central Bank had even sounded the alarm: “ the continued appreciation of the euro exchange rate could require monetary action .” A year later, after massive intervention by the ECB, the euro plunged, but deflation has never been more threatening. Inflation is expected to rise in negative territory in the first quarter 2015, mainly due to the falling oil prices.
The rise of the dollar against the euro is a major trend a divergence of history. Economic divergence first between the United States who have found a strong pace of growth (3.1% expected by the IMF in 2015), while the eurozone struggles to get over 1%. Divergence of monetary policy next. The Fed plans to raise interest rates this year, when the ECB is about to become more accommodating than ever. The launch of a sovereign debt buyback plan should lead to a significant increase in its balance sheet and de facto increase the number of circulating euro. “ Expectations of increasingly strong that the ECB adopt a quantitative easing program on January 22, associated with political concerns before the parliamentary elections in Greece should keep the euro under pressure ” concludes Michel Sneyd of BNP Paribas.
Greece tumbles indeed like a dog in a bowling game, replacing the eurozone against its weaknesses. The question of “Grexit” shaken the financial center as Der Spiegel claimed Sunday that Berlin would no longer fear a possible exit of Greece from the eurozone, considered inevitable exit in case of victory of anti-austerity left in elections Greek elections on January 25th. This statement has pushed the euro below 1.19 dollars from the opening of markets in Asia, despite the formal denials from the German government.
elements previously validated by the markets but who never cease to strengthen the dollar. “ A new year, but the same old euro ” and finds Kit Juckes at Societe Generale, who believes that the consensus on the level of the euro by year-end is expected to decline. There is currently $ 1.18 and could be heading towards $ 1.14, representing a potential decrease of 4.5%. Before going further by 2016? For Asoka Wöhrmann Deutsche AWM, “ The United States is warning the international economic cycle, the dollar will maintain momentum. In the long term, it seeks parity with the euro . “
Pierrick Fay
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