{"id":6184,"date":"2019-09-30T06:00:48","date_gmt":"2019-09-30T10:00:48","guid":{"rendered":"https:\/\/currencylive.com\/?p=6184"},"modified":"2019-09-30T06:36:25","modified_gmt":"2019-09-30T10:36:25","slug":"111092-eur-usd-euro-edges-lower-german-inflation-is-key","status":"publish","type":"post","link":"https:\/\/currencylive.com\/news\/111092-eur-usd-euro-edges-lower-german-inflation-is-key\/","title":{"rendered":"EUR\/USD: Euro Edges Lower, German Inflation Is Key"},"content":{"rendered":"<p>The euro tumbled versus the dollar for a second straight week, last week. The pair fell 0.7% across the week to end at US$1.0940. This was only slightly up from the two-year low of US$1.0904 struck in early trade on Friday. As the new week kicks off, the euro is edging lower versus the dollar.<\/p>\n<p>The mood for the euro soured\u00a0 in the previous week as investors continued to digest the European Central Bank\u2019s move to ease monetary policy. Earlier in the month the ECB announced that they will restart the bond buying programme and cut the overnight deposit rate.<\/p>\n<p>Data last week, most notably the pmi readings from the eurozone and Germany, pointed to a slowing eurozone economy and a gloomy outlook. Today the euro could come under further pressure as investors look to German inflation figures. Analysts are forecasting that German inflation ticked lower to 1.3% year on year in September, down from 1.4%. Weakening German inflation will raise concerns over the health of the German economy and fuel fears that Europe\u2019s largest economy is heading for recession. Under these circumstances the European Central Bank could be inclined to cut interest rates further.<\/p>\n<table>\n<tbody>\n<tr>\n<td><strong>Why do interest rate cuts drag on a currency\u2019s value?<\/strong><\/td>\n<\/tr>\n<tr>\n<td>Interest rates are key to understanding exchange rate movements. Those who have large sums of money to invest want the highest return on their investments. Lower interest rate environments tend to offer lower yields. So, if the interest rate or at least the interest rate expectation of a country is relatively lower compared to another, then foreign investors look to pull their capital out and invest elsewhere. Large corporations and investors sell out of local currency to invest elsewhere. More local currency is available\u00a0 as the demand of that currency declines, dragging the value lower.<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<p>&nbsp;<\/p>\n<h3><strong>Dollar Steady Awaiting Trade &amp; Impeachment Developments<\/strong><\/h3>\n<p>The dollar moved higher across the previous week. Whilst US data was generally positive, it failed to impress. However, the US dollar found support from sentiment, as risks increase investors look to the dollar for its safe haven status.<\/p>\n<p>There were two main issues that dollar investors focused on last week; one was the US House speaker Nancy Pelosi announcing that the House would launch a formal impeachment investigation into President Trump.<\/p>\n<p>The second was the US \u2014 Sino trade. Relations appeared to be improving between the two powers ahead of trade talks in October. However, a report on Friday that the Trump administration may move to limit investment in China will certainly raise tensions.<\/p>\n<p>This week there is plenty of US data for investors to digest which will help them to assess the extent of damage that the US \u2014 Sino trade dispute is having on the US economy. Friday\u2019s non-farm payroll data will be the most closely watched. Any signs that the US economy is slowing could unnerve investors.<\/p>\n<p>&nbsp;<\/p>\n<table>\n<tbody>\n<tr>\n<td><strong>What do these figures mean?<\/strong><\/td>\n<\/tr>\n<tr>\n<td>When measuring the value of a pair of currencies, one set equals 1 unit and the other shows the current equivalent. As the market moves, the amount will vary from minute to minute.<\/p>\n<p>For example, it could be written:<\/p>\n<p><em>1 EUR = 1.12829 USD<\/em><\/p>\n<p>Here, \u20ac1 is equivalent to approximately $1.13. This specifically measures the euro\u2019s worth against the dollar. If the U.S. dollar amount increases in this pairing, it\u2019s positive for the euro.<\/p>\n<p>Or, if you were looking at it the other way around:<\/p>\n<p><em>1 USD = 0.88789 EUR<\/em><\/p>\n<p>In this example, $1 is equivalent to approximately \u20ac0.89. This measures the U.S. dollar\u2019s worth versus the euro. If the euro number gets larger, it\u2019s good news for the dollar.<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<p>&nbsp;<\/p>\n<p><em>This publication is provided as general information only and is not intended as an exhaustive treatment of its subject. TransferWise Inc. and its affiliates (&#8220;we&#8221; or &#8220;us&#8221;) expressly disclaim any contractual or fiduciary relationship with you on the basis of the content of this publication, and you may not rely thereon for any purpose. You should consult with qualified professionals or specialists before taking, or refraining from, any action on the basis of the content in this publication. The information in this publication does not constitute legal, tax, investment or other professional advice from us.\u00a0 We make no representations, warranties or guarantees, whether express or implied, that the content in the publication is accurate, complete or up to date, and DISCLAIM ANY IMPLIED WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE.<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"<p>The euro tumbled versus the dollar for a second straight week, last week. The pair fell 0.7% across the week to end at US$1.0940. This was only slightly up from the two-year low of US$1.0904 struck in early trade on Friday. As the new week kicks off, the euro is edging lower versus the dollar. [&hellip;]<\/p>\n","protected":false},"author":163946597,"featured_media":4327,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[1380,1381],"tags":[1413,1395,1393,1556,1387,1493,1415,1400,1397,1398],"class_list":{"0":"post-6184","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-eur","8":"category-usd","9":"tag-ecb","10":"tag-eur","11":"tag-euro","12":"tag-impeachment","13":"tag-inflation","14":"tag-nfp","15":"tag-trade-dispute","16":"tag-trump","17":"tag-us-dollar","18":"tag-usd"},"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.6 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>EUR\/USD: Euro Edges Lower, German Inflation Is Key - Currency Live<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/currencylive.com\/news\/111092-eur-usd-euro-edges-lower-german-inflation-is-key\/\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Fiona Cincotta\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"4 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\\\/\\\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/111092-eur-usd-euro-edges-lower-german-inflation-is-key\\\/#article\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/111092-eur-usd-euro-edges-lower-german-inflation-is-key\\\/\"},\"author\":{\"name\":\"Fiona Cincotta\",\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/#\\\/schema\\\/person\\\/8ef0fafb6c93f1204150bb907b42cfec\"},\"headline\":\"EUR\\\/USD: Euro Edges Lower, German Inflation Is Key\",\"datePublished\":\"2019-09-30T10:00:48+00:00\",\"dateModified\":\"2019-09-30T10:36:25+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/111092-eur-usd-euro-edges-lower-german-inflation-is-key\\\/\"},\"wordCount\":741,\"image\":{\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/111092-eur-usd-euro-edges-lower-german-inflation-is-key\\\/#primaryimage\"},\"thumbnailUrl\":\"https:\\\/\\\/currencylive.com\\\/news\\\/wp-content\\\/uploads\\\/2019\\\/08\\\/100351-gbp-eur-high-uk-inflation.jpg\",\"keywords\":[\"ecb\",\"eur\",\"euro\",\"impeachment\",\"Inflation\",\"nfp\",\"trade dispute\",\"trump\",\"us dollar\",\"usd\"],\"articleSection\":[\"EUR\",\"USD\"],\"inLanguage\":\"en-US\",\"copyrightYear\":\"2019\",\"copyrightHolder\":{\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/#organization\"}},{\"@type\":\"WebPage\",\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/111092-eur-usd-euro-edges-lower-german-inflation-is-key\\\/\",\"url\":\"https:\\\/\\\/currencylive.com\\\/news\\\/111092-eur-usd-euro-edges-lower-german-inflation-is-key\\\/\",\"name\":\"EUR\\\/USD: Euro Edges Lower, German Inflation Is Key - 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