On March 18, the euro reached its highest level against the dollar in the past five months. This is a jump in the rate, which occurred due to a number of important economic factors that affect the currency market. As reported by IZ with reference to Reuters, one of the main reasons is the expectation that Germany will increase its loans after the parliament's decision on a large-scale increase in borrowing. This move could help stimulate growth in the EU's largest economy. Also, the possibility of peace agreements between Russia and Ukraine cannot be ignored, which adds instability to the market.
According to analysts, including strategists at Macquarie, the increase in European sovereign bond yields in March and the inflow of funds into the euro and sterling were additional factors that influenced the growth of the European currency. The growth of the deficit in Europe could also affect the exchange rate in the future. According to forecasts, the euro exchange rate could rise to $ 1.15 by the end of 2025.
Analyzing current trends, experts also note that the dollar reached a two-week high against the Japanese yen, due to expectations of the results of the Federal Reserve and the Bank of Japan meetings. In this context, political factors should also be taken into account, in particular the impact of Donald Trump's policies on the exchange rate.
We remind you that we previously wrote that the US dollar is stabilizing in Ukraine.