US Dollar Rose Amid World Stock Markets Recovering
The greenback has strengthened amid the stabilization of global stock markets. DAX traded higher by 0.8%, CAC 40 rose by 0.6%, FTSE gained 0.8%. The Japanese yen remains the strongest major currency. The New Zealand dollar remains under pressure in anticipation of the RBNZ meeting.
The euro fell at the beginning of the European session against the US dollar under the pressure of weak data on industrial production in Germany and the increased demand for the American currency. But still, the European single currency stabilized after news from Germany that the conservative union headed by Chancellor Angela Merkel and the center-left Social Democratic Party reached an agreement on the formation of a coalition government. Industrial production in Germany fell by 0.6% in December, in contrast to the growth of 3.1% in November. Economists predicted that the volume of production will decrease by 0.5%.
The British pound is lower against the US dollar, while market participants are preparing for a meeting of the Bank of England to be held tomorrow. A small pressure on the pound also provided data on house prices in the UK. Housing prices in the UK unexpectedly fell by 0.6% in January, after they fell by 0.8% in December. Economists forecast a 0.2% rise in prices.
European Commission raised Eurozone growth forecast. Eurozone GDP is projected to grow 2.3% in 2018, and 2.0% in 2019. The UK economic growth is awaited at 1.4% level in 2018. Eurozone inflation is expected to be 1.5% in 2018 and 1.6% in 2019.