Monday in early European deals, the euro rose against the currencies of U.S., U.K. and Japan as European stocks soared in early trading as investors remained cautious ahead of Tuesday’s Federal Reserve meeting. The euro jumped to a 4-day high against the pound.
But the euro pared its recent gains against the franc and thus the pair fell to a 4-day low, mainly due to the sharp rise of the Swiss currency in the session.
Germany’s DAX advanced 0.5% in early deals, France’s CAC 40 index gained 0.64% and U.K.’s FTSE 10 index soared 0.8%.
The Federal Reserve Open Market Committee is scheduled to meet on Tuesday and make an announcement regarding its near-term direction of monetary policy at 2:15 pm ET.
In its last meeting, the Federal Open Market Committee left its key interest rates unchanged at 0%-0.25%. Kansas City Federal Reserve President Thomas Hoenig continued to dissent, arguing for a change in the language, as he is of the view that the economy is recovering modestly as projected.
The Fed said in the post-meeting policy statement that the pace of recovery in output and employment has slowed in recent months. This was in contrast to its view in June, when it said the economic recovery is proceeding and the labor market was improving gradually. The committee also dropped its reference to financial conditions as being less supportive of growth. The FOMC also said the pace of the economic recovery is likely to be more modest in the near term than had been anticipated.
The euro gained against the U.S. dollar in early European deals on Monday. As of now, the euro-dollar pair is worth 1.3120, up from Friday’s close of 1.3041. If the euro climbs further, it may likely target the 1.316 level.
During early European deals on Monday, the euro advanced against the yen. The euro-yen pair that closed last week’s trading at 111.85 is currently worth 112.30. The next upside target level for the European currency is seen at 113.0.
The euro strengthened against the British pound in early European session on Monday. At present, the euro-pound pair is trading at a 4-day high of 0.8382, compared to Friday’s close of 0.8346. On the upside, 0.840 is seen as the next target level for the European currency.
The euro that climbed to 1.3233 against the Swiss franc at 2:50 am ET Monday lost ground thereafter. The euro-franc pair plunged to a 4-day low of 1.3141 at 3:30 am ET. If the euro slides further, it may likely target the 1.300 level. The pair that closed Friday’s trading at 1.3172 is now worth 1.3150.
The U.S. NAHB housing market index for September is expected in the North American session today.