The euro has gained 8% against the US dollar this year. In response, European Central Bank (ECB) president Christine Lagarde has promised to “monitor carefully” developments in the foreign exchange market.
A rising euro creates two problems: firstly, it means lower import prices. Eurozone consumer price inflation turned negative in August, so more deflationary pressure is unwelcome. Secondly, it hits the earnings of exporters, especially significant in a bloc where exports make up about 45% of GDP and bourses are crammed full of multinationals.
Subscribe to MoneyWeek
Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE
Sign up to Money Morning
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
-
Zoopla: House prices slows to 1.4% in May as rate of sales at four year highThe average UK property now costs £268,400, Zoopla says, but some areas of the country are experiencing much higher price growth than others.
-
FCA reveals 'once in a generation' advice changes - what the reforms mean for youConsumers to get free access to financial advice type help for pensions and investment following proposed changes from the regulator
-
Investors remain calm as the Middle East war unfoldsConflict in the Middle East has failed to shake oil or stock markets. Can the peace hold?
-
European stocks are back in business – can it last?European stocks enjoy a strong start to the year, but the rally is proving uneven as France struggles to keep up
-
The British railway industry is in rude health – here's why investors should jump aboardThe railway industry has bounced back from the devastating impact of the pandemic and is entering a new phase of development – and profitability
-
Infrastructure investing: a haven of stable growth amid market turmoilFrom booming construction in emerging markets to digital and green transitions, the infrastructure sector offers security, returns and long-term opportunities
-
The costly myth of “sell in May”Opinion May 2025's strong returns for US stocks have once again shown that putting too much weight on seasonal patterns will only make investors poorer, says Max King
-
Who’s driving Tesla?As Elon Musk steps back from government with his eyes on the stars, investors ask if he’s still behind the wheel at his electric-car maker.
-
Europe's investment potential: Stocks are cheap and ready to riseDaniel Avigad, manager of the TM Lansdowne European Special Situations Fund, discusses Europe's investment potential with Andrew van Sickle
-
Investment opportunities in the world of Coca-ColaThere is far more to Coca-Cola than just one giant firm. The companies that bottle and distribute the ubiquitous soft drink are promising investments in their own right.
