Euro continues to weaken
It was a muted week for the euro. Early in the week, a slight improvement in business confidence in Germany was not enough to boost the euro as analysts considered the uncertain outlook overall and the fact that to date, the stimulus measures from the ECB have yet to yield results – the euro has weakened 1.5% so far in November.
Positive indications about a conclusion to the US-China trade war kept the US dollar on top of the euro this week but overall the central currency is holding relatively steady as political uncertainty elsewhere increases volatility and the ECB continues to look to the future. This week Benoît Cœuré, executive board member of the ECB mooted the possibility of a central bank digital currency (CBDC) and an official at the Central Bank of France suggested that blockchain technology could deliver improvements to the financial system. As yet the impact of the latest round of QE has yet to provide any assistance to the euro but there appears to be a confident and forward-looking approach which may help the euro hold its ground.
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