FREE NEWSLETTER: Econintersect sends a nightly newsletter highlighting news events of the day, and providing a summary of new articles posted on the website. Econintersect will not sell or pass your email address to others per our privacy policy. You can cancel this subscription at any time by selecting the unsubscribing link in the footer of each email.

posted on 18 May 2015

The Euro: What Is Next?

Written by , GEI Associate

The Euro has been declining for an extended period of time now, however, many experts have concluded very different things as to what its path may lead to in the next few months, as well as years. As of today, the Euro is equivalent to $1.14, which is astoundingly less than the exchange rate of merely a year ago, which was approximately $1.37 to the Euro. The current inflation rate is 1.5%.

The Euro is a currency that has definitely fluctuated quite a bit over its history, but it is also quite a young currency, so that would have a significant effect on that; furthermore the different collapses external to public policy also have had great effects on the value of the currency. However, since 2002, the value for the currency has increased quite steadily.

In March of just this year, Goldman Sachs and HSBC have had quite contrasting views on the trajectory of the Euro and to what extent it will continue. Goldman Sachs had quite a pessimistic outlook, predicting that the Euro would dip below the dollar to $0.80 as soon as 2017. Goldman was quoted on this issue:

ECB quantitative easing is setting in train large portfolio outflows by eurozone residents. On the other side of the equation, the dollar rally is in full bloom. After all these years of extraordinary monetary accommodation, which prevented the Dollar from trading its true strength, we see the coming normalization of US monetary policy as an important catalyst

At the time, HSBC had a quite contradicting conclusion, stating that they felt the dollar was reaching its end of its rise, and the Euro would appreciate about 15% through 2017. Regardless, people feel the decline of the value in the euro is correlated to the convergence of euro zone bonds with US bonds.

As of last Thursday, however, the Euro had reached a 3 month high, contrary to the predictions of many. This seems to be occurring because the United States economy is slightly underperforming at the moment. However, in the three months ending 14 May 2015 the euro has grown by 0.4%. The trade levels between the Euro and the US Dollar both were at their highest levels in 3 months. During this period the Euro has risen in value, but the overall exchange volume has diminished noticeably. The volatility of the markets in Europe has diminished, therefore the flow is slowing and the Euro is improving.

As a result, the Euro is slowly turning around from its rapid decline, and likely should recover. The dollar for the 5th consecutive week has been weakening relative to the Euro.


Click here for Historical News Post Listing

Make a Comment

Econintersect wants your comments, data and opinion on the articles posted.  As the internet is a "war zone" of trolls, hackers and spammers - Econintersect must balance its defences against ease of commenting.  We have joined with Livefyre to manage our comment streams.

To comment, using Livefyre just click the "Sign In" button at the top-left corner of the comment box below. You can create a commenting account using your favorite social network such as Twitter, Facebook, Google+, LinkedIn or Open ID - or open a Livefyre account using your email address.

You can also comment using Facebook directly using he comment block below.

Econintersect Contributors


Print this page or create a PDF file of this page
Print Friendly and PDF

The growing use of ad blocking software is creating a shortfall in covering our fixed expenses. Please consider a donation to Econintersect to allow continuing output of quality and balanced financial and economic news and analysis.

Take a look at what is going on inside of
Main Home
Analysis Blog
Democratic Development Lowers the Cost of Credit
Is Growing Household Debt An Economic Counter-Dynamic?
News Blog
Did The Dodd-Frank Act Make The Financial System Safer?
A Close Look At The Decline Of Homeownership - Part Five Of Five
Do Institutional Investors Chase Returns?
Infographic Of The Day: How To Survive A Deadly Snake Bite
Early Headlines: Global Mfg 1970-2010, No Refugee Spike, GOP Health Proposal Leak, GOP Town Halls, Trump's Debt Decrease, Macron Gains, China's $9 Trn Moral Hazard, Americans Oppose Wall And More
Premium Seats At Premium Events Equal Premium Prices
Earnings And Economic Reports: Week Starting 27 February 2017
Time Crystals: How Scientists Created A New State Of Matter
Cost Of War Against ISIS Reaches 11 Billion Dollars
What We Read Today 25 February 2017
Candid Camera Classic: Dirty Clean Words
How Reliable Are GDP Consensus Forecasts?
What You Don't Know About Your Policy Can Hurt You... Financially
Investing Blog
Snapchat Is In The Money Burning Business
Technical Thoughts: How To Buy The Dips
Opinion Blog
Why Winning The French Presidential Election Could Be A Poisoned Chalice
Unintended Consequences Of Corporate Tax Incentives
Precious Metals Blog
Deflation And Gold: A Contrarian View
Live Markets
24Feb2017 Market Close: Wall Street Rose From Session Lows To Close In The Green Near The Unchanged Line, Short-Term Indicators And Analysts Questioning Continuing Bull Run
Amazon Books & More

.... and keep up with economic news using our dynamic economic newspapers with the largest international coverage on the internet
Asia / Pacific
Middle East / Africa
USA Government



Analysis Blog
News Blog
Investing Blog
Opinion Blog
Precious Metals Blog
Markets Blog
Video of the Day


Asia / Pacific
Middle East / Africa
USA Government

RSS Feeds / Social Media

Combined Econintersect Feed

Free Newsletter

Marketplace - Books & More

Economic Forecast

Content Contribution



  Top Economics Site Contributor TalkMarkets Contributor Finance Blogs Free PageRank Checker Active Search Results Google+

This Web Page by Steven Hansen ---- Copyright 2010 - 2017 Econintersect LLC - all rights reserved