He feels that the impact of Juncker’s comments was somewhat weakened yesterday when ECB council member Nowotny stated that the Euro exchange rate is “not a matter of major concern” while also offering his view that he doesn’t see a long-term upward trend for the Euro.
The Euro still remains under upward pressure in the near-term as both confidence in Euro-zone assets is returning, and the ECB is being out-eased by other major central banks despite the Euro-zone economy under performing.
He finishes by writing, “The rise of the Euro can be viewed as a positive sign that the Eurozone debt crisis is easing and/or a negative sign that the Eurozone is currently losing a currency war to weaken domestic currencies to support growth. It is a dynamic that we anticipate will likely pressure the ECB to resume easing monetary policy later in 2013 weighing upon the Euro.”
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