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© Reuters. The euro exceeds $ 1.05 after US data and Powell’s statements
Frankfurt (Germany), Dec 1 (.).- The euro appreciated on Thursday above 1.05 dollars after the publication of data from the US economy and after the president of the Federal Reserve (Fed), Jerome Powell, will signal a minor interest rate hike in December.
The euro was trading around 4:00 p.m. GMT at $1.0486, compared with $1.0320 in the final hours of European currency market trading the previous day.
The European Central Bank (ECB) set the reference exchange rate for the euro at $1.0454.
Inflation in the US fell to 6% in October and activity in the manufacturing sector contracted in November, figures that support a lower interest rate rise because it seems that inflation has passed its peak.
This boosted the euro and other assets considered riskier.
The ten-year US Treasury yield fell below 3.60%.
Some relaxation in financial markets also supported the euro because China relaxes its restrictions against outbreaks of covid-19.
Powell ventured this Wednesday that the central bank’s rate hikes will slow down “as soon as December”, thus hinting that the next increase will be 0.5 points instead of 0.75 as those that have been approved in recent months. .
For this reason, the euro appreciated despite the drop in retail sales in Germany of 2.8% in October compared to the previous month and the downward revision of the figures for manufacturing activity in the euro area.
The final purchasing managers’ index for the euro area manufacturing sector stood at 47.1 points (47.3 points in the previous calculation and 46.4 points in October), registering its highest in two months, according to S&P Global .
The slowdown in the euro zone manufacturing sector continues in November but inflationary pressures ease further.
The single currency was exchanged in a fluctuation band between 1.0397 and 1.0530 dollars.
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