On Thursday, Euro rallies for the first time after more than a week of losing against U.S dollar. This happened after Mario Draghi, president of the European Central Bank didn’t say anything about the purchase of sovereign bonds.
As Commonwealth Foreign Exchange in Washington analyst Omer Esiner said, the value of euro increased not because of what came out of Draghi’s mouth but what didn’t.
After the European Central bank left interest rates the same, Draghi acknowledged in his post-meeting news conference the interest of the market in numbers on the bond purchase program of the bank, but added the its ‘ultimate and only mandate’ is to bring inflation back to a level that’s below the 2% target but at least a little closer to it.
Draghi specified that he realizes the desire of the market to have exact figures for everything but said that he wouldn’t take his time explaining or emphasizing the balance sheet per se.
The president of ECB also stated that the bond purchase plan of the European Central Bank will have a substantial impact on the balance sheet and he sees an increase in discrepancies in the monetary policy between his bank and the Federal Reserve of the U.S.
Meanwhile, the euro rallies as high as $1.2698 which as seen first at $1.2690 which went up to 0.5%. This by the way is the first gain of Euro against the U.S. dollar since the 22nd of September.
The dollar on the other hand struggled and went down 0.6% against Japan’s yet to 108.19. This happened after the waning of global manufacturing data and the Ebola health scare had the investors pushed in search for safer assets. The euro had to go through a 9-day low against yen.
The dollar index dipped 0.6% all the while pulling away from a high of 86.218 on Tuesday when shareholders took profits after the greenback trimmed losses.