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The ECB last week reacted in the usual belated fashion to the sharp rise of the Euro and its potential effects on Eurozone inflation and economic recovery.
By Enrique DIAZ-ALVAREZ, Chief Risk Officer Ebury
For now, the impact on the currency was muted, but we expect to see many variations on the theme that the currency has risen too much, too fast in the coming weeks, which introduces short term downside risks for the euro. All G10 currencies lost ground against the dollar save Sterling, buoyed by the UK´s fast progress in vaccinating its population.
Emerging market currencies were mixed, but overall they withstood fairly well the significant sell off in stocks and risk assets in general. The short squeezes in some stocks...
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