FRANKFURT (dpa-AFX) – The euro made a small roller coaster ride on Tuesday. Losses in the morning were offset by gains in the afternoon. Most recently, the common currency cost 1.0985 US dollars, about as much as in the morning. The European Central Bank set the reference rate at 1.0965 (Friday: 1.0981) dollars. The dollar thus cost 0.9119 (0.9106) euros.
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In the morning the euro was put under pressure from several sides. Weak economic data from the euro zone dominated the picture: industrial sentiment in the euro zone fell to its lowest level in almost three years. ECB money and credit data were also weak. In addition, a regular survey of banks by the ECB revealed that institutions further restricted their lending standards in the first quarter.
Some relief came in the afternoon from the weaker US dollar. It fell as new economic data indicated a slight slowdown in the labor market. background is the monetary policy: If the tight job market weakens, wage pressure and thus the risk of inflation will decrease. This in turn helps the US Federal Reserve to get high inflation under control. In other words, the weaker the labor market, the fewer rate hikes the Fed is likely to make. That weighs on the dollar.
For other important currencies, the ECB set the reference rates for one euro at 0.87868 (0.88050) British pounds, 150.70 (149.35) Japanese yen and 0.9841 (0.9839) Swiss francs. An ounce of gold was trading at $2009 in London this afternoon. That was about $27 more than the day before./bgf/jsl/he