Euro rebounds above $1.14

Euro rebounds above $1.14

Having weakened to a 13-month minimum the common currency rebounded above the $1.14 mark on Monday due to the fact that the Turkish lira drifted away from record minimums versus the evergreen buck, although still facing big losses for the day.

The currency pair EUR/USD jumped to 1.1423, having dived to 1.1365 overnight, which is its weakest reading since early July of last year.

Having soared back briefly above the 7 lira to the greenback level, the currency pair USD/TRY finally reached 6.8921, although still gaining 7.62% for the day. Overnight, the currency pair demonstrated a record maximum of 7.1326.

The Turkish currency managed to pare back some of its dips right after Turkey’s key financial institution promised to provide liquidity and reduce lira as well as foreign currency reserve requirements for the country’s banks.

Worsening relations between Turkey and America have pushed the lira down over 40% in 2018. For the last week the Turkish currency lost 1/5 of its value against the evergreen buck.

The Turkish lira has also been suppressed by concerns as for Turkish leader’s soaring control over monetary policy as well as the economy and also his opposition to higher interest rates.

The selloff in the Turkish currency has affected financial markets against the backdrop of worries over companies’ exposure to the Turkish lira and economy. On Friday, the ECB warned that a number of euro zone financial institutions can be exposed to the steep dive in the Turkish currency.

Assessing the purchasing power of the American currency versus its key rivals, the USD index went down by 0.09% being worth 96.10 having soared to a 13-month maximum of 96.39 earlier.

The currency pair USD/JPY hit 110.77 having dived to a one-and-a-half month minimum of 110.11.

The currency pair EUR/JPY reached 126.49, bouncing off an intra-day minimum of 125.13.

 

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