The euro is on course for its longest losing streak since its inception amid bets that the European Central Bank is done raising interest rates, Bloomberg reports.
The currency fell for a ninth straight week, the longest losing streak since the euro was created more than two decades ago. It is down 5.6% against the greenback after hitting a high in mid-July and is currently trading near March lows.
Over the past two months, traders have abandoned the euro amid bets that the ECB will struggle to tighten monetary policy further amid signs of a worsening economy. That view was fueled again this week when President Christine Lagarde offered a tenth hike and signaled that rates had been peaked.
“The ECB has just given dollar enthusiasts another reason to start selling the euro,” said Dipak Shah, head of FX G-10 options trading at Nomura Holdings Inc. “We expected the euro to pick up, no only against the dollar, but also against other currencies”.
Hedge funds became the most negative for the euro since the beginning of the year, and analysts revised down their year-end forecasts for the currency. Analysts believe that the euro will end the year at $1.09, compared to $1.12.
The euro is down 0.5% so far this week at $1.07.
2023-09-15 10:21:51
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