Currencies: unusually calm for the week as a whole – 2024-02-23

February 23, 2024

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The FOREX ended the week as it began it, i.e. in an almost absolute calm that contrasts with the exuberance of the stock markets, with a new deluge of stock market records on Friday.
The bond markets also added their bullish touch on Friday, but without any impact on currencies.

The Dollar Index finished virtually unchanged at -0.05% at 103.9 (compared with 104.30 last Friday… a week for nothing).

The E/$ pair finished unchanged at 1.0820, as did the $/Yen pair (at 150.40), and the biggest variation was in the $/Can$ pair, with the greenback up 0.2%.

The euro could have broken away from the pack of currencies that stagnated on Friday, but traders didn’t punish Germany’s GDP decline: it fell by 0.3% in volume terms in Q4 2023 compared with Q3, according to CVS-CJO data from the Federal Statistics Office, which thus confirms its first estimate published on January 30.

However, this blow to growth is somewhat offset by the rebound in Germany’s Ifo business climate index for February, from 85.2 in January to 85.5 in February, a rise ‘entirely attributable to an improvement in the expectations component’, according to Capital Economics (German business leaders are openly banking on a rate cut in the second half of 2024).

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