Mostly Tailwinds for the Euro Again in April
April 27, 2023
- The eurozone economy remains surprisingly resilient. But a stronger economy also means higher inflation. Core price gains still show no real signs of easing, likely prompting the European Central Bank to keep tightening monetary policy until at least June. Interest rate spreads with the US continue to narrow, bolstering the euro.
- Financial markets remain vulnerable to a possible rebound in investor jitters and weaker risk appetite. We expect several economies to dip into a moderate recession over the next few quarters. As previous interest rate hikes really start to bite, the US dollar should benefit from its safe haven status.
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