Dollar up against the euro

Published: 3 Jan at 5 AM Tags: Euro, Dollar,

The dollar has hit a four-and-a-half year high against the euro. Comments by Mario Draghi, head of the European Central Bank, have also helped to push the dollar to parity with the Swiss franc. It is likely that over the course of this year the central bank will introduce further measures to stimulate the economy.

The euro is currently trading at $1.2002, the lowest the currency has been since the middle of 2010. The single currency has also been hit by disappointing manufacturing data coming out of the eurozone.

The greenback has been given a boost over the last year because of the disparity between European and Japanese loosening of fiscal policies and the intention to increase interest rates in the US.

Draghi’s comments also forced the Swiss central bank to introduce further easing allowing the US dollar to hit an equal value with the franc for the first time in more than four years.

The dollar index, which measures the greenback against a basket of the world’s major currencies, is close to its highest level in nearly nine years at 91.131. The dollar is also worth 120.46 yen, an increase of 0.58 per cent against the Japanese currency. Poor manufacturing data during December has forced Sterling to $1.5328, its lowest in 17 months.