Euro gain seen as temporary

Financial and commodity markets analytics

The euro is pushing higher in late trading today after better than expected CPI numbers hit the market, halting a run of several days’ losses..

At 8.05pm (GMT) the euro was trading at 112.27 against the US dollar up from 111.82 at close of trade on Friday.

The latest consumer price index numbers from Europe came in at 0.2% against analysts’ expectations of 0.1% and following on from 0.2% in the previous month yesterday’s trade.

Although the European currency received a boost today after traders abandoned the US dollar, it has been falling for the past five sessions after the problems such as the currency devaluation and mini stock market crash in the Chinese economy.

Some traders believe that as we grow closer to September, currencies such as the Euro will suffer as the US Fed tightens monetary policy.

"Stocks markets are in focus and absence of risk appetite is acting as a headwind to the dollar," said Niels Christensen, FX strategist at Nordea.

"Having said that, with a September rate hike back in focus, I am biased toward more downside in the euro against the dollar."


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