The Euro traded weakened to
2 consecutive sessions against the U.s. Dollar on Wednesday after
several dismal European data back trigger concerns about the economic
slowdown ahead of the elections in France and Greece. The
manufacturing sector shrank more than estimates of Italy, with factory
orders shrank at the fastest pace in the last 3 years. Data from Germany, Spain and France also shows the factory activity declined significantly. Its negative eurozone data also adds to the speculation over monetary policy of the ECB is to be taken at a meeting Thursday.
"Even
though the ECB has been providing liquidity, data that indicates if a
long-term fundamental outlook in the Euro zone are still negative," said
Brian Kim, a currency expert at Royal Bank of Scotland in Stamford,
Connecticut. The ECB will meet in Spain on
Thursday, amid increasing pressure to immediately launch a program to
purchase bonds or other measures in order to protect the small economies
in the Euro area from a worse condition. Although
the ECB is still going to maintain interest rates, some are hoping the
central bank will cut its interest rates, which are at risk of
generating negative pressure for the exchange rate of the Euro.
Posted in: Euro Depressed Ahead Of ECB Meeting