The EUR declined versus the Dollar after several Euro-Zone official expressed concerns over the volatility in the market and the growing strength of the common currency. The EUR retreated from a 14-month high against the USD on speculation European policy makers will today reiterate their concerns that the currency's gains are hurting the region's economic recovery. As the exchange rate nears $1.50, it presents problems for the European economy and manufacturing sector.
The EUR has strengthened 15% versus the Dollar in the past 6 months, making the region's exports more expensive to overseas buyers. The EUR traded as high as $1.4994 versus the Dollar in earlier trade but failed to break above the psychologically important $1.50 level. It is currently trading at $1.4931, down from $1.4941 in the previous session. The EUR traded at 135.68 Yen from 135.66 Monday.
Looking ahead for the rest of the weak, the release of the Ifo institute's business climate index Friday is expected to provide some support for the EUR as it is expected to show business confidence in Germany improved, adding to signs that the recovery is gaining momentum. Today, trader should follow closely the MPC Meeting Minutes due at 8:30 GMT as they will provide insight and direction for the GBP for the near future.