Forex: The Euro slips before the speech of Lagarde; the Dollar remains stable

The euro tumbled Monday as investors waited for the first official speech of the new president of the European Central Bank later in the session, while the u.s. dollar remained stable in the face to a basket of currencies.

The euro was slightly lower at 1,1160 at 10: 25 am.

The new president of the ECB, Christine Lagarde, will deliver his first keynote address on Monday, while policy makers of the ECB are divided on the best way to respond to the slowdown of the growth of the block.

Lagarde, who took up his duties on 1 November, has already made echo of his predecessor, Mario Draghi, in blaming Germany and the netherlands do not invest their surpluses to support growth.

Investors also follow the evolution of the trade negotiations between china and the us after both parties have stated that they have made progress towards an agreement to phase 1, which could be signed this month.

The dollar index was at 97,11, after having fallen from the summit of 97,15 reported Friday.

The dollar initially rose on Friday after figures showing that the growth of employment in the United States slowed less than expected in October, but the us currency was unable to retain its gains after the Institute for supply management (ISM) announced that the manufacturing sector contracted for the third consecutive month in October .

The greenback is under pressure since the federal Reserve has cut rates last Wednesday and left the door open to others if needed, while avoiding the risk of a tightening.

“Interest rates in the world converge once again towards the bottom. This probably means less volatility between the two currencies, as interest rate differentials are reduced and the likelihood of policy change decreases,” said Marshall Gittler, analyst at ACLS Overall.

“It could also mean a USD, a CAD, a AUD and NZD weaker, because these are the currencies with the lowest interest rates currently and, therefore, the more leeway to reduce rates. This is probably why the USD and the CAD have been the big losers of the last week.”

The central banks of Australia and the United Kingdom to hold meetings of general policy this week and is expected to remain stable, although one might think that the Bank of England may put an end to its bias to tightening.

There are also at least seven stakeholders of the Fed is ready to talk about this week.

The dollar rose against the japanese yen as demand for safe haven securities, has decreased from 107,87 to 108,38.

The pound sterling remained strong in 1,2936, as investors bet that the risk of Brexit on was lesser now that an election campaign was underway.

–Reuters contributed to this report

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