Dollar slips lower on Ukraine peace hopes; euro gains
The US dollar retreated Thursday, with the euro rallying, on raised hopes of an end to the Ukraine-Russia war after U.S. President Donald Trump held talks with the leaders of both of the involved countries.
At 04:25 ET (09:25 GMT), the Dollar Index, which tracks the greenback against a basket of six other currencies, traded 0.2% lower to 107.590, sliding to its lowest since Feb. at 107.49, after rising as high as 108.52 in the previous session.
President Trump said late Wednesday that he had spoken with Russian President Vladimir Putin and Ukrainian President Volodymyr Zelenskiy about ending the ongoing conflict in Ukraine, saying both men had expressed a desire to reach a peace deal in separate phone calls.
In Europe, EUR/USD traded 0.3% higher to 1.0413, rising to a one-week high on the news that Washington was pushing for a peace deal, ending the years-long conflict in Ukraine.
“EUR/USD is c10% below its pre-Ukraine invasion level,” said analysts at Barclays (LON:BARC) in a client note, “while the cost of war has inflated EU government deficits and fuelled stagflation across Europe, resulting in weaker growth and higher bond yields. So any progress towards a pause in the conflict would be seen as likely to ease the fiscal and economic burden on the region.”
Data released earlier Thursday showed that German inflation remained flat year-on-year in January at 2.8%, in line with forecasts.
GBP/USD rose 0.2% to 1.2479, near a one-week high, helped by data showing the U.K. economy unexpectedly grew in the final quarter of last year.
In Asia, USD/JPY dropped 0.3% to 153.96, with the Japanese currency strengthening after data showed Japan's annual wholesale inflation jumped to a seven-month high of 4.2% in January and accelerated for the fifth straight month, reinforcing market bets of another rate hike in Japan this year.
Source: Investing.com
