The
euro traded higher on Friday, getting close to the highest level in three months after
European Central Bank) ECB) has
announced that it will increase its pandemic-related emergency asset purchase program.
At
press time, the EURUSD pair traded higher at 1.1346, while the highest level
recorded during the session was at 1.1384, the highest since March 11, also
heading for the third consecutive week of gains.
The
euro has now corrected upwardly most of the downside fall that had occurred on
March, but it would still need to rise further near 1.15 to complete a 100%
Fibonacci Retracement.
Against
the pound, the European currency was down at 0.8966, while the lowest level
0.8952.
ECB
policymakers decided on Thursday to increase the pandemic emergency program to
buy assets by an additional 600 billion euros ($672 billion). This comes in
addition to the €750 billion government bond-buying program announced by the
central bank in March.
Total
asset purchases have now reached €1.35 trillion, amid attempts to boost the
region's economy in the wake of the Corona pandemic.
Asset
purchases under the emergency procurement program are scheduled to continue
until at least the end of June 2021.
In
addition, the Bank decided to continue the program of purchasing assets at a
monthly pace of 20 billion euros along with purchases of an additional 120
billion euros temporarily until the end of this year.
According
to the Monetary Policy Statement, the Board of Governors continues to stand
ready to adjust all its instruments appropriately in order to ensure that
inflation rates towards the target improve in a sustainable manner.
Meanwhile,
there are hopes that the euro area would start to recover after reopening last
month, which is boosting demand on the single currency.
On
the other hand, the drop in haven demand and unrest in the United States over
the death of George Floyd have put downside pressure on the green
currency.
The
dollar index, which trails the performance of the green currency against six
major currencies, surged 0.13 percent to trade at 96.72, while the highest
level recorded was at 96.82.
Later in the day, the
U.S. will release its jobs report for May, where downbeat figures may add more
downside pressure to the green currency.
