News

Euro Stable as Eurozone Avoids Recession, Dollar Softens Before Fed Decision

Euro Stable as Eurozone Avoids Recession, Dollar Softens Before Fed Decision
Euro Stable as Eurozone Avoids Recession, Dollar Softens Before Fed Decision
Subscribe to Newsletter

Euro Stable as Eurozone Avoids Recession, Dollar Softens Before Fed Decision

  • 6174
  • 2 min.
  • 5 connections
pexels.com
Euro Stable as Eurozone Avoids Recession, Dollar Softens Before Fed Decision

Eurozone Escapes Recession

The euro stabilized on Tuesday following the release of data indicating that the eurozone narrowly avoided a technical recession in the fourth quarter. Conversely, the U.S. dollar experienced a slight decline as traders awaited the Federal Reserve's monetary policy decision scheduled for later in the week.

Gross domestic product (GDP) across the 20 eurozone countries remained stagnant in the fourth quarter compared to the previous three months. Notably, Spain and Portugal demonstrated robust growth, while Italy experienced a modest uptick. However, the German economy contracted in the final months of 2023.

Despite the euro's marginal increase of 0.14% to $1.0846 against the dollar, prevailing expectations suggest a stronger outlook for the U.S. economy compared to the eurozone. Consequently, investors have fully factored in an anticipated rate cut by the European Central Bank (ECB) in April.

Chief Market Analyst at Scope Markets, Joshua Mahony, remarked, "For the ECB, today's figure eases the pressure somewhat, but it is clear that the so-called soft landing being pursued by ECB President Christine Lagarde has been somewhat softer than many would have liked."

With the Federal Reserve poised to maintain interest rates, market attention remains fixated on the tone set by Fed Chair Jerome Powell during the upcoming press conference. Any indications of future rate adjustments will be closely scrutinized.

Michael Pfister, FX Analyst at Commerzbank, noted, "After Fed Chairman Jerome Powell's dovish comments at the press conference following the last meeting, market participants are likely to be looking for more precise information on the timing of the first rate cut."

Markets eye potential rate adjustments with U.S. job openings data. Sterling dips ahead of Bank of England meeting, while dollar slips against yen.

Analysts expect the dollar-yen rate to be shaped by Fed expectations, especially as Japan considers policy changes in Q2. Japan's jobless rate dropped to 2.4% in December, below forecasts, potentially impacting yen sentiment alongside upcoming wage data in Q2.

Persons1 and Companies4 in the news

Tags:
Section: economy

Related news

Last news

Quotes

All

John Malkovich Wins Best Actor at Venice Film Festival Amid Oscar Buzz

MALKOVICH John
MALKOVICH John

I am humbled to be chosen for this award, which has been given to so many wonderful actors over the past 83 iterations of the Venice Film Festival

Jimmy Kimmel Slams FCC ‘Threats’ as White House Fires Back

KIMMEL James
KIMMEL James

This is yet another attack on free speech, something that has become all too familiar for us at the show, for us in the country

BBC Line of Duty star Martin Compston teases new series and says 'this is the end'

COMPSTON Martin
COMPSTON Martin

It's for Jed to say, it's not for me to say whether the show will ever end but I think it's fair to say that this is the end of the story arc that's been building since series one. Everything will come to a head on this one.

Game of Thrones’ Maisie Williams Addresses Arya Stark Spinoff Rumors and Possible Return

WILLIAMS Margaret
WILLIAMS Margaret

I don’t know, really. She would have to be developed in some way because I feel like I’ve changed so much

Mariska Hargitay Honors Gloria Steinem in Emotional Emmys Speech for ‘My Mom Jayne’

HARGITAY Mariska
HARGITAY Mariska

I just want that invitation to go out, especially to women

Buy this ad slot 240×400 slot is free Write →

Events

All

Hug Your Boss Day 13 September

There is no need to feel bad if you forget about National Hug Your Boss Day on February 4. It is a day to show appreciation and gratitude to your supe ...

Read more >