News Tech: The euro edged higher against the dollar on Wednesday as investors braced for further developments in the Ukraine crisis after Western countries announced sanctions against Russia for sending troops to Ukraine. breakaway regions. According to the US company Maxar, satellite images over the past 24 hours show several new deployments of troops and equipment in western Russia and more than 100 vehicles at a small airfield in southern Belarus, bordering the border with Ukraine.
But some analysts expect the Ukraine crisis to influence the ECB’s decisions at next month’s policy meeting. “Looks increasingly likely to escalate and will prompt a cautious message from the ECB at its March 10 meeting,” said analysts at Groupe SEB. The euro rose 0.1% against the dollar to $1.1340 after hitting its lowest Tuesday since Feb. 14 at $1.1286. However, according to Commerzbank analysts, “monetary policy is trending back, and risk aversion is in charge”. “If the situation in Ukraine worsens further, EUR-USD could therefore easily make another attempt towards 1.12,” they said in a research note.
“The short-term movement of all currency pairs is mainly driven by the degree of escalation,” said Moritz Paysen, FX and rates advisor at Berenberg. “Surprisingly, the Euro has remained steady against the USD despite the risk aversion move, but we suspect that won’t happen for a very long time and the Euro will then depreciate accordingly. ”, he added. The coin recovered slightly on Tuesday as it neared its lowest level since February. 3, the day the European Central Bank turned hawkish and pushed its exchange rate up.
The Russian currency fell 0.9% to 79.38 against the dollar. The dollar index, which measures the greenback against six other currencies, fell 0.1% to 96.949. The New Zealand dollar rose 0.8% after the Reserve Bank of New Zealand raised interest rates and said further tightening may be needed. Safe-haven currencies have cooled off after recovering from the escalating Ukraine crisis, but analysts say they are still in demand. The Swiss franc lost 0.1% against the euro at 1.0435, having touched its highest level since February 22 at 1.0335 the previous day. In January, it hit its highest level since June 2015 at 1.0298.