The euro has been unable to hold on to the gains that followed the announcement by the European Central Bank that the phasing out of its asset purchase program is to gather pace, despite the uncertainty generated by the conflict in Ukraine. The ongoing energy crisis is exacerbating inflationary pressures in the old continent, while economic growth prospects suffer due to exposure to the war on its eastern flank. The ECB is sticking with its intention to tighten policies, in a move that is designed to contain escalating consumer prices but may end up hurting growth, while also triggering concerns over the impact the end of asset purchases may have on the spread between German and gouthern European debt. In such a scenario the outlook for the euro doesn’t look great, with further losses likely, especially in relation to the US dollar.
Ricardo Evangelista – Senior Analyst, ActivTrades
Gold prices are hedging down during early Friday trading, but still look set to end the week in the green, as the sentiment in the markets remains under the influence of the war in Ukraine. The price of the precious metal retreated from the maximums reached earlier in the week, as the scope for gains created by risk aversion is somehow capped by the prospect of an hawkish Fed, which supports the US dollar. This dynamic was illustrated by the rise in Treasury yields, which also supported the greenback, that followed the release of US inflation figures on Thursday, the highest annual rise in decades reading at 7.9%, with gold suffering some losses due to the inverted correlation with the American currency.
Experienced writer and journalist, working in the global online trading sector, Steffy is the Editor of LeapRate. She has previous experience as a copywriter and has been with the company since January 2020. Steffy has a British and American Studies degree from St. Kliment Ochridski University in Sofia.