The end of the European Central Bank’s reign as one of the pre-eminent doves among monetary-policy makers could kindle a rebound in the euro.
Dustin Reid, chief fixed income strategist at Mackenzie Investments, which oversees about C$200 billion ($156bn), said he sees the euro climbing as high as $1.20 by year-end, as ECB officials like president Christine Lagarde change their tune on the central bank’s outlook.
That’s compared with a median Bloomberg forecast of $1.16 for the fourth quarter and a Friday spot price of about $1.13.
The euro fell about 7 per cent against the US dollar last year, when the greenback rallied in anticipation of higher interest rates from the Federal Reserve.
“You’re starting to see the boat turn a little bit,” Mr Reid said at the TradeTech FX US conference in Miami.
“Some of the language we got from Ms Lagarde during the press conference at the February meeting I would’ve expected at the March meeting, and she definitely left the door open in terms of being a little bit more two-way in the outlook.”
On Friday, traders holding out for a hawkish ECB pivot got a glimpse of hope following a report that more bank officials are conceding that interest rates will likely need to rise late this year, helping the euro climb off an intra-day low. Money markets are now pricing in 44 basis points of tightening by year-end, compared with 42 basis-points on Thursday.
While the common currency has climbed nearly 1 per cent against the greenback in February, most of those gains came in the run-up to February’s ECB meeting and the pair has trended lower since then. A measure of one-year put- and call-option demand has grown less bearish on the euro in the past month, even as near-term sentiment is weighed down by geopolitical tensions on the continent.
“The market will get very aggressive in terms of baking in hikes for Q4 of this year, and definitely for the first half of ‘23,” Mr Reid said. “So rightly or wrongly, I think that’s setting up to be a relatively constructive tone for euro-dollar.”
Killing of Qassem Suleimani
UAE currency: the story behind the money in your pockets
MATCH INFO
Uefa Champions League semi-final, first leg
Bayern Munich v Real Madrid
When: April 25, 10.45pm kick-off (UAE)
Where: Allianz Arena, Munich
Live: BeIN Sports HD
Second leg: May 1, Santiago Bernabeu, Madrid
UAE currency: the story behind the money in your pockets
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Tips for entertaining with ease
· Set the table the night before. It’s a small job but it will make you feel more organised once done.
· As the host, your mood sets the tone. If people arrive to find you red-faced and harried, they’re not going to relax until you do. Take a deep breath and try to exude calm energy.
· Guests tend to turn up thirsty. Fill a big jug with iced water and lemon or lime slices and encourage people to help themselves.
· Have some background music on to help create a bit of ambience and fill any initial lulls in conversations.
· The meal certainly doesn’t need to be ready the moment your guests step through the door, but if there’s a nibble or two that can be passed around it will ward off hunger pangs and buy you a bit more time in the kitchen.
· You absolutely don’t have to make every element of the brunch from scratch. Take inspiration from our ideas for ready-made extras and by all means pick up a store-bought dessert.
UPI facts
More than 2.2 million Indian tourists arrived in UAE in 2023
More than 3.5 million Indians reside in UAE
Indian tourists can make purchases in UAE using rupee accounts in India through QR-code-based UPI real-time payment systems
Indian residents in UAE can use their non-resident NRO and NRE accounts held in Indian banks linked to a UAE mobile number for UPI transactions
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Position: legal consultant with Al Rowaad Advocates and Legal Consultants.
Abu Dhabi Sustainability Week
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