The euro rose Thursday to its highest level in more than eight months against the dollar, benefiting from a US inflation indicator that undermined the greenback, as well as the unexpected strength of the European economy.
Around 8:15 p.m. GMT, the single currency gained 0.80% against the
“greenback”
, at 1.0844 dollars for one euro.
Earlier, it hit $1.0867, a high since late April 2022. Already on the defensive, the dollar took on new shine with the release of the CPI price index, which came out down 0.1 % over one month in December, in line with economists' forecasts.
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Over one year, inflation fell to 6.5%, against 7.1% the previous month.
This is the sixth consecutive month of slowing inflation in the United States, after the peak in June, at 9.1%.
Comforted by this indicator,
"most members of the Fed
(US central bank)
will no doubt feel comfortable enough to slow the pace of rate hikes, to a quarter point in February"
, commented, in a note, Edoardo Campanella, of UniCredit.
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Operators now attribute a probability of more than 95% to this scenario, whereas they mostly opted for half a point a month ago.
To these elements specific to the American economy is combined the fact that
"investors are buying European"
at the moment, according to Marc Chandler, of Bannockburn Global Forex.
For the analyst, the
"pessimism"
that has surrounded Europe for several months, largely inherent in the war in Ukraine and the threat of a major energy crisis,
"was exaggerated
" and has partially dissipated.
But the headwinds facing the dollar are also reflected in its parity with other currencies.
The greenback thus retreated Thursday to a low of seven months against the yen and five months against the yuan, while it descended into depths more explored for nearly three years against the Mexican peso.
However, the slide of the "greenback" could moderate, or even stop, because inflation, even less strong than last year, remains very high compared to historical averages, underlined, in a note, Joe Manimbo , of Convera, which limits the hopes of an interest rate cut as early as this year.
"Some are not convinced"
that the appreciation of the euro against the dollar can continue for a long time, warns Marc Chandler.
"They think it's just a fix."