The ongoing conflict between Ukraine and Russia continues to have an impact on the forex market. Still, the Euro made a considerable movement in the market lately following a meeting of the European leaders with the President of Ukraine. Experts believe that this new development is not good enough to bring the value of the currency to its level prior to the conflict. The new policies on interest rates by the FOMC could weaken the currency’s foothold further.
The meeting in Kyiv has had a positive effect on the EUR in the market. The currency reportedly climbed up to 1.5% in the few days, following the downward trend that lasted for weeks. It is, however, thought to be inadequate for the currency to have any significant momentum. Such claims come from the fact that the meeting did not cover anything related to Europe’s economy and predominantly discussed getting Ukraine’s freedom back.
The EUR/USD has continued to maintain at a lower level for several weeks now. Although a quick recovery for the Euro looks slim, it is not impossible. The recent show of strength through the meeting clearly had a positive impact on the currency. Furthermore, Europe’s coalition with NATO in this crisis also expects a palpable impact on the price. The USD has managed to keep a straight face the last few weeks withstanding the impacts of the war in Eastern Europe. Aligning their opinion with America is seen as a good thing for the Euro by many forex brokers in the market. If you’d like to make use of this current dip, check out the top forex brokers here and the best forex broker in USA platforms.
The Federal Open Market Committee will be having the meeting on the 16th of March to discuss the revision of interest rates. This meeting is expected to give a significant price action to the EUR/USD pair. The USD has remained at the top ever since the conflict began in Europe. This ascension was fueled primarily by the weak position held by the euro. Even so, predicting whether the impact of the meeting will be positive or negative is difficult. Mainly B because the minutes are expected to carry several surprises.
Furthermore, the yield curve from the Treasury looks good, too, within 30 basis points. Many also believe that the USD is likely to receive a push from the projections following the policy decision. On the other hand, the Euro’s funding conditions are still lacking compared to its pre-war position. The western sanctions have also had a huge impact on the banking sector, which is currently facing huge stress. All signs indicate that the EUR is set to take a more cautious position in the market.