EUR 2016 Outlook – Forget About Parity
EUR 2016 Outlook – Forget About Parity
By Kathy Lien, Managing Director of BKAsset Management
Six years after the financial crisis and the European Central Bank is still struggling to turn around their economy.
As recently as December, they increased stimulus in a desperate attempt to revive growth and drive inflation higher. This illustrates how deeply entrenched the slowdown is and how poor of a job Eurozone policymakers have done this past year. In the third quarter, the Eurozone economy expanded by a mere 0.3%. During this same period the U.S. economy grew 2%. Inflation is low around the world but the approximately 10% slide in EUR/USD combined with the full scale QE program launched in early 2015 should have been more effective in boosting inflation, which ran at a 0.2% annualized pace in November – well short of the central bank’s 2% target. 2016 brings more challenges for the Eurozone economy.
As for the currency, forget about parity. Technically, there’s only 2 important support levels in EUR/USD – the 12 year low of 1.0459 and parity.
The greatest risks for the Eurozone in 2016 are political. Greece will be back in the headlines as the government struggles to enact reforms and meet the demands of its bailout. According to S&P, the country is still at risk of default. At the same time, migration will be a touchy subject for Europe. In 2015, European nations welcomed millions of Syrian refugees with open arms but the Paris attacks have transformed the attitude within Europe and there are now calls for tighter border controls. These demands will quickly intensify if ISIS stages another attack in the region. There’s no question that there will be attempts and it will be up to European intelligence to avoid another catastrophe. In 2015 Russia’s brazen intervention in Ukraine shattered Europe’s illusion that conflict on the continent was long gone history. The EU was forced to enact sanctions, straining relations with Russia and in the middle of the year, they will need to decide whether the sanctions which last until July, should be scrapped or extended. So between sluggish growth, deepening refugee crisis, ISIS aggression and Russian tensions, 2016 will be full of challenges for Europe.
Source: http://kathylien.com/japanese-yen/eur-2016-outlook-forget-about-parity
Anyone can join.
Anyone can contribute.
Anyone can become informed about their world.
"United We Stand" Click Here To Create Your Personal Citizen Journalist Account Today, Be Sure To Invite Your Friends.
Please Help Support BeforeitsNews by trying our Natural Health Products below!
Order by Phone at 888-809-8385 or online at https://mitocopper.com M - F 9am to 5pm EST
Order by Phone at 866-388-7003 or online at https://www.herbanomic.com M - F 9am to 5pm EST
Order by Phone at 866-388-7003 or online at https://www.herbanomics.com M - F 9am to 5pm EST
Humic & Fulvic Trace Minerals Complex - Nature's most important supplement! Vivid Dreams again!
HNEX HydroNano EXtracellular Water - Improve immune system health and reduce inflammation.
Ultimate Clinical Potency Curcumin - Natural pain relief, reduce inflammation and so much more.
MitoCopper - Bioavailable Copper destroys pathogens and gives you more energy. (See Blood Video)
Oxy Powder - Natural Colon Cleanser! Cleans out toxic buildup with oxygen!
Nascent Iodine - Promotes detoxification, mental focus and thyroid health.
Smart Meter Cover - Reduces Smart Meter radiation by 96%! (See Video).
Things are very confusing at the moment in EURO; we got to make sure we have clear idea of where things are heading before trading or else we could be in serious risk. I am fairly lucky that I trade with OctaFX broker; it’s a rocking company with having excellent facilities which includes low spreads from 0.2 pips, high leverage up to 1.500 while there is also daily market news and analysis service available so all that makes trading easier.