Why Europe's Central Bank Shouldn't Worry About the Euro

Instead, it should focus on increasing flexibility in the conduct of monetary policy.
By Ferdinando Giugliano
8 Σεπτεμβρίου 2017, 9:30 π.μ. EEST

The European Central Bank has spent much of this decade convincing markets that the euro is irreversible. It is therefore mildly ironic that policy makers in Frankfurt may be in trouble because of the sudden return of confidence in the single currency.

EU's Wieser-Hope Greece Can Tap Markets by Spring 2018: ORF

By REUTERSJUNE 17, 2017, 7:30 A.M. E.D.T.


The New York Times

VIENNA — Thomas Wieser, the EU official who runs preparations for Eurogroup meetings, hopes Greece will be able to tap international markets for money between autumn this year and spring 2018, he told ORF radio on Saturday.

ECB Said to Be Unlikely to Include Greece in QE in Coming Months

by Alessandro Speciale
13 Ιουνίου 2017, 2:00 π.μ. EEST

Bloomberg

The European Central Bank is unlikely to include Greek bonds in its asset-purchase program for the foreseeable future, a person familiar with the matter said, as European creditors aren’t prepared to offer substantially easier repayment terms on bailout loans to improve the nation’s debt outlook.

World’s Largest Private Bank Makes Contrarian Call on Euro Rally

by Stefania Spezzati
23 January 2017, 5:10 μ.μ. EET
Bloomberg
At a time when some investors are questioning the future of the euro, the world’s largest manager of money for the wealthy is advising clients to bet on a rally.

UBS Wealth Management recommends buying the European currency as it sees it being undervalued against the dollar and because of faster euro-area inflation. It expects the euro to climb about 7 percent to $1.15 in six months, while the majority of forecasters surveyed by Bloomberg expect it to slip to $1.03-$1.04 in the same time frame.

Record Capital Outflows Push Euro Toward Parity With Dollar

Higher interest rates in the U.S. are drawing money out of the eurozone

The Wall Street Journal

By MIKE BIRD
Updated Dec. 20, 2016 5:32 p.m. ET

More money has left eurozone financial markets this year than at any time in the bloc’s history, helping drive the euro toward parity with the dollar for the first time in 14 years.

The eurozone had its largest-ever net outflows in the 12 months to September, data from the European Central Bank showed Tuesday.

Eurozone investors bought €497.5 billion ($516.5 billion) of financial assets, such as stocks and bonds, outside the bloc in that period. Global investors, meanwhile, sold or let mature €31.3 billion of eurozone assets during the year. Together, that adds up to a net outflow of €528.8 billion, the most since the single currency was introduced in 1999.

Euro, Dollar Flirt With Parity

Trump outlook and Fed’s likely move are strengthening dollar, and ECB may not help stop euro’s fall

The Wall Street Journal

By MIKE BIRD and  IRA IOSEBASHVILI
Updated Nov. 20, 2016 10:00 p.m. ET

A 10-day losing streak for the euro against the U.S. dollar is rekindling an old debate: Will the common currency reach parity with the dollar?

In the last two weeks, the euro has fallen 4% against the dollar, hitting $1.06, a level last seen 12 months ago.

The sharp shift in expectations for U.S. interest rates and economic growth since the American presidential election has refueled the euro’s fall against the greenback. If the Federal Reserve increases rates, expectations are the dollar would rise further by drawing money to the U.S. looking for higher returns.

Sterling soars to 6-week high against weakening euro

Thu Nov 10, 2016 | 12:54pm EST

By Jemima Kelly and Patrick Graham | LONDON
Sterling surged 1.5 percent to a six-week high against the euro on Thursday, as investors unwound short positions against the pound amid uncertainty about the fallout from the U.S. election and focused on upcoming European political risks.

The pound's almost 20 percent slide since Britain voted to leave the European Union in June has been the main currency story on developed markets in the months that have followed, and investors have built up record short positions against it on the view that it has further to fall.

But the fog of uncertainty created by Donald Trump's victory in the U.S. presidential vote, after a campaign that included a range of potentially disruptive policy pledges, from building a wall between the United States and Mexico to declaring China a currency manipulator, could provide a different set of impulses over the next few months.

Euro zone lending growth levels off, keeps ECB on toes

Thu Oct 27, 2016 | 4:46am EDT

Reuters

Growth in loans to euro zone companies and households is leveling off, European Central bank data showed on Thursday, keeping the pressure on the ECB to maintain its aggressive stimulus policy for months to come.

Lending to companies grew by 1.9 percent year-on-year in September while household loans rose by 1.8 percent, keeping the steady but slow pace seen since the start of the summer

Monetary Policy And Political Problems To Drive The Euro Lower

OCT 22, 2016 @ 11:57

Stephen Pope ,   CONTRIBUTOR

Forbes

Over the past week, foreign exchange markets have been offered opposing views on the next play in European and American monetary policy. The differences are wider than the Atlantic Ocean.

In Europe, the Bank of England (BOE) faces many problems as the falling level of Sterling threatens to ignite inflation from its current 1.0% at a time when the economy is struggling to accommodate the uncertainty over the terms of Brexit.

A larger dilemma faces the European Central Bank (ECB). With a tepid economy, GDP growth just 0.3% and unemployment of 10.1% coupled to a fragile banking system it is obliged to hold open the door for further monetary stimulus in December and maintain that accommodation deep into 2017.

London Won’t Easily Surrender Role as Euro Clearinghouse, Hammond Says

Chancellor of the Exchequer says the City should keep the business after Brexit

The Wall Street Journal

By INYOUNG HWANG
Oct. 6, 2016 1:37 p.m. ET


The City of London won’t quietly relinquish its central role in derivatives trading even after the U.K. completes its exit from the European Union, a British official said Thursday.

Philip Hammond, the chancellor of the Exchequer, said firms in London will continue to handle transactions on euro-denominated derivatives. The location of clearing, in which funds are transferred from one account to another, and of settlement, in which financial institutions agree on account balances, has emerged as a key issue in Britain’s departure from the bloc.

London is home to some of the region’s biggest clearinghouses, which are intermediaries that stand between buyers and sellers of financial instruments and act as a buffer should one side fail to hold up its obligation. A threat to the clearing and settlement business could strike at the heart of the city’s large financial industry.

Dollar flat after U.S. data, euro rises with bond yields

Wed Oct 5, 2016 | 3:30pm EDT

Reuters

By Richard Leong | NEW YORK
The dollar was little changed against a basket of currencies on Wednesday as encouraging data on the U.S. services sector offset a weaker-than-expected report on private-sector job growth, while the euro was broadly higher in step with a rise in higher euro zone bond yields.

U.S. services industries grew at their fastest pace in 11 months in September, reinforcing the view of a steady economic expansion which would allow the Federal Reserve to raise interest rates later this year, analysts said.

Wednesday's upbeat snapshot of the services sector from the Institute for Supply Management followed perceived hawkish remarks from regional Fed presidents Loretta Mester and Jeffrey Lacker earlier this week.

Fatigued Investors Want Draghi to Buy Greece Before They Do

 Nikos Chrysoloras

September 28, 2016 — 4:03 AM EEST Updated on September 28, 2016 — 10:05 AM EEST

Bloomberg

Michel Danechi isn’t buying the Greek turnaround story just yet.
As Greek business leaders and government officials presented to investors last week in London a list of reasons why valuations of the country’s assets make them attractive, Danechi’s Duet Asset Management took note. But what he wants to see is for Greece to show it can make good on pledges made to euro-area creditors so it can be included in the European Central Bank President Mario Draghi’s quantitative easing program.

Economic imbalances risk 'destabilising' euro zone: ECB's Draghi

Mon Sep 26, 2016 | 5:11pm EDT

Reuters

Economic imbalances within the euro zone risk destabilising the currency bloc, top European Central Bank officials said on Monday, stressing the responsibility of governments to help boost growth while respecting EU rules.

ECB President Mario Draghi and board member Benoit Coeure also acknowledged the limitations of the ECB's ultra-expansionary policy of low interest rates and money printing.

"In our Economic and Monetary Union, in particular, the economic governance framework is essential to avoid imbalances that would eventually risk destabilising the euro area," Draghi told a European parliamentary committee in Brussels.

Why Euro Looks Stuck Even as Fed Gears Up to Move

On a trade-weighted basis, the euro has actually risen since quantitative easing started in 2015
The Wall Street Journal

By RICHARD BARLEY
Aug. 30, 2016 7:36 a.m. ET
3 COMMENTS
Once upon a time, signs the Federal Reserve was gearing up to increase rates would have been big news for the euro. Policy divergence was a key focus for foreign-exchange traders. But times have changed.

True, the euro declined against the dollar in the wake of the Jackson Hole conference, but it was far from an extraordinary move. And the bigger picture is that at $1.117, the single currency is in the middle of a relatively narrow range that has held since February.

ECB lends a helping hand to Greece

Greek's ailing banks will be given access to the European Central Bank's refinancing program. The move brings Greece closer to financial normalization, a gift for its compliance in passing tough austerity measures.

Deustche Welle


Cash-strapped Greek banks will be able to borrow cheap money from the ECB starting June 29, the ECB's Governing Council decided on Wednesday.
This requires that the ECB waives its minimum rating requirement, allowing Greek banks to post government-guaranteed debt - even though it is rated as "junk" - as collateral in exchange for ECB funding.
Greek brokerage Euroxx said the move "will be essential for the reduction of Greek banks' funding costs, which along with the gradual easing of capital controls should also help the all-important return of deposits into the system."

Euro Falls Against Dollar

ECB’s Nowotny suggests officials should use more policy instruments to raise competitiveness

The Wall Street Journal

By IRA IOSEBASHVILI

Oct. 15, 2015 2:14 p.m. ET

0 COMMENTS

The euro fell against the dollar Thursday, after a member of the European Central Bank suggested officials should use more policy instruments to raise the region’s competitiveness.

The euro was recently down 0.7% at $1.1392, giving back most of the previous day’s gains. The Wall Street Journal Dollar Index, which gauges the buck against a basket of 16 currencies, was unchanged at 86.62.

E.C.B. Doubts Add to Uncertainties on Greek Debt Lifeline

By JACK EWING and LIZ ALDERMANMAY 6, 2015

The New York Times

FRANKFURT — As Greece mounts an 11th-hour diplomatic offensive across Europe to secure financial aid that it desperately needs to avoid a default, patience with Athens is wearing thin at the European Central Bank.

That could pose big problems for Greece, since the central bank is the country’s biggest creditor and a necessary source of financial support for struggling Greek commercial banks.

ECB lifts ceiling on Greek emergency loans

Published: Apr 2, 2015 2:58 a.m. ET

By NEKTARIA STAMOULI

http://www.marketwatch.com/story/ecb-lifts-ceiling-on-greek-emergency-loans-2015-04-02

ATHENS--The European Central Bank on Wednesday increased the amount of money Greek banks can borrow under an emergency lending program, extending a lifeline for the country's banks as its government continues tense negotiations with its creditors over its bailout program.

Dollar Hits Fresh Highs Against Euro, Yen

Traders say Greenback Being Bought Ahead of Next Week’s FOMC meeting

By HIROYUKI KACHI

Updated March 10, 2015 3:14 a.m. ET

The Wall Street Journal

The dollar set fresh multiyear highs against the euro and the yen in Asian trade Tuesday, as market participants bet on the continuing divergence in monetary and economic conditions in the U.S., the eurozone and Japan.

The common currency fell to $1.0785—its lowest since Sept. 3, 2003—in midday trading before stabilizing at $1.0796 midway through afternoon trading.

Greece Stirs Doubt on Debt Owed IMF

Cash-Strapped Athens Suggests It Might Be Short on Some March Payments

By IAN TALLEY And  ALKMAN GRANITSAS

Feb. 27, 2015 7:33 p.m. ET

32 COMMENTS

Greece’s cash-strapped government suggested in the past week that it might default on some of the debt it owes the International Monetary Fund in March, which would make it the first advanced economy in the institution’s seven-decade history to fall into protracted arrears with the fund.