Tuesday, May 27, 2014

Euro Dropped for the 2nd Day as Draghi Speach Yesterday

Trying to rebound over, the euro reached a three-month low against the dollar as European Central Bank President Mario Draghi signaled policy makers are ready to take action in June should they see low inflation becoming entrenched.

The 18 nation currency fell below its 200-day moving average for a second day after protest parties racked up gains across the 28-nation European Union in elections to the bloc’s Parliament. The euro rose to 1.3646 as after falling to 1.3615, the weakest since February 13 and below its 200-day moving average of 1.3639.

The euro has declined since touching a 2 1/2-year high of 1.3993 on May 8, when Draghi said he was comfortable with adding stimulus as soon as next month, denting demand for the currency. He yesterday said the key issue for the ECB right now is the timing of any action. The ECB next meets on June 5.

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