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ecb meeting

There is an increasing expectation that the ECB might actually make a policy change at their next meeting.

But as for whether that will have an impact on the exchange rate, that’s another question. EURUSD has been moving higher of late, but that has been more weakness in the dollar than strength in the euro.

As the world economy reopens, risk appetite is returning which means investors are leaving safe havens like the dollar. During the pandemic, the real interest rate spread between Europe and the US shrunk for the first time in several years.

However, it hasn’t been enough to get the common currency to break significantly higher.

The Issues

Despite the massive changes in the economy because of the COVID-19 outbreak, the euro’s issues remain stubbornly the same.

They’ve just been magnified as the “frugal” countries skirmish with their southern counterparts about how to finance the COVID recovery fund.

The latest version of the stimulus fund still ha...

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