Euro on a hot run with Ukraine-Crimea referendum

Over the last couple of weeks we have seen the Euro gain a significant amount of strength across the board – mostly notably against the other two majors; Sterling and the US Dollar. Key resistance points have been broken on both pairings – GBPEUR, EURUSD – and there is no particular reason to believe this is about to change. UK data for example has remained positive and with no further Euro boosts since Draghi spoke at the beginning of the month, we might have expected a correction against the Euro, but this has failed to materialise showing very solid backing for the single currency.

 

Further evidence of the Euro’s strength can be found by looking at the Crimean crisis – what could be more damaging for a currency than a massively volatile political situation, coupled with military intervention, on its very doorstep? Yet the Euro has strengthened as the crisis develops and is showing no negative symptoms this morning following the overwhelming referendum yesterday by the people of Crimea to join Russia – despite the EU and the US considering this possibility against international law and hence completely impossible, and with a threat of sanctions against Russia as a result of pushing in this direction. In short the Euro is so strongly supported that even the threat of a rekindling of cold war tensions is not enough to cause it to drop back…

If you have a requirement to buy euros in the coming days, weeks or months, then you must consider what impact waiting to secure could have on your purchase. Speak to your CI account manager to be kept informed of what is happening with day to day data releases and what options are available to you to protect against negative market movement.

Data to watch for this week:

 Monday

EU CPI inflation

 Tuesday

US CPI inflation

Bank of England governor’s speech

Wednesday

Bank of England policy statement minutes

US Interest rate decision and policy statement 

Thursday

US Bank stress test info

Friday

UK Public sector net borrowing