Frankfurt (Germany), Apr 17 The euro fell sharply to $1.0910 on Monday from the $1.10 level as the greenback rallied after some data from the US economy and despite the general fear that it is entering a recession.
The EU currency was trading at around 15:00 GMT at $1.0918, down from $1.1002 in the latest trading hours on the European forex market the previous day.
The European Central Bank (ECB) has set the reference exchange rate for the euro at $1.0981.
The New York Federal Reserve (Fed) Empire State Manufacturing Index, which measures conditions in New York State’s manufacturing sector, rose in April and helped accelerate the dollar’s appreciation.
In addition, confidence in the construction sector in the United States improved in April for the fourth consecutive month.
As a result, the likelihood of the Fed extending the current bull cycle longer and raising interest rates further this year increases.
Fed Board of Governors member Christopher Waller said the Fed hasn’t made much progress in fighting inflation and that’s why interest rates should rise further.
Federal Reserve Bank of Chicago President Austan Goolsbee said a “mild recession” in the United States is entirely possible.
Members of the ECB’s Governing Council have come out in favor of raising interest rates by 25 or 50 basis points in May.
The single currency was trading in a trading range between $1.0910 and $1.0999. EFE
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