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Euro continues to gain strength as Russia Ukraine peace talks continue

Euro continues to gain strength as Russia Ukraine peace talks continue

Yesterday, negotiations between Russia and Ukraine continued, although little progress appears to have been made, talks are set to continue online today. Despite the hard evidence of progress, the euro continued to gather some upward momentum versus the dollar and sterling – sterling edged slightly higher versus the dollar also. 

The moves coincided with euro and UK swap rates drifting higher yesterday, while US rates came under some downward pressure. On the data front, both the industrial and services EC sentiments printed ahead of expectations and German inflation rose by more than the consensus (6.7%) to 7.6% in March. 

As we get underway this morning, the firmer tone to the euro sees EUR/USD open above the midpoint of $1.11-1.12 and EUR/GBP just above the 85p mark, while GBP/USD continues to operate in the bottom half of the $1.31-1.32 range. 

Turning to the day ahead, there is a busy data schedule in the US. The main release of note, core-PCE inflation is projected to rise to 5.5% from 5.2% – US consumption and income data are also due. Meanwhile, in the Eurozone, the unemployment rate is forecast to inch slightly lower to 6.7% in February from 6.8%, so EUR/USD traders will be monitoring these events closely.

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