On Thursday, the euro fell on international foreign exchange markets from its highest level in 14 months against the dollar, under pressure from weak news from German retail and signs of slowing economic activity in the U.S.
In such circumstances, the euro dropped from the highest level reached yesterday of 1.3588 dollars, trading at 1.3568 dollars, which means it was almost unchanged compared to the previous close.
The single European currency weakened against the yen by 0.2 percent, to 123.34 yen. This brought it below the highest level in the last 33 months of 123.87 yen, which it reached on Wednesday. The dollar was slightly up against the yen, trading at 91.12 yen.
The euro was slightly pressured by data from German retail that showed an unexpected decline in sales in December last year. The news of a massive loss by the German banking giant Deutsche Bank in the fourth quarter also negatively impacted the single currency.
– Weak data in German retail is putting pressure on the euro – said Chris Turner, head of currency analysis at ING Bank.
Analysts, however, do not expect significant losses. Despite today’s slight weakening, the euro strengthened by almost three percent against the dollar in January. Recently, the euro has been buoyed by easing concerns regarding the debt crisis in the eurozone.
On the other side of the Atlantic, the U.S. central bank (Fed) announced yesterday, after the conclusion of a two-day meeting, that its stimulus plan remains in effect, emphasizing its importance for reducing unemployment.
A Japanese central bank (BOJ) official signaled that the BOJ will provide additional stimulus if necessary. Expectations of further easing of monetary policy will continue to pressure the yen, according to analysts.
