The US Dollar continues to devalue as the prospects of an interest rates cut by the Fed, as early as in July, sink in. Currently trading at a 3-month low against the Euro, just below $1.14, there may be further downside risk for the Greenback as markets continues to discount the expected reduction in monetary policy divergence, between the two central banks.
The European Central Bank doesn’t have much margin of manoeuvre, with its interest rates already at historical lows, while the Fed started tightening in 2015 and could potentially cut 8 times before reaching the current ECB levels.
Photo by Lynn Kintziger.
