On the first day of October, the single European currency, the Euro (EUR), saw a more pronounced change in the trading trend, with the Euro strengthening against the US dollar (USD). In the morning of 1 October, the global currency pair EUR/USD traded above US$ 1.17 per EUR. At 8:35 am CET, this currency pair was trading at US$ 1.1750 per EUR, with the current daily appreciation of the EUR by +0.27% against the USD.
According to analysts, the Euro has taken a positive turn and has ended its roughly four-month decline against the main commodity market – the US dollar. During September, the EUR fell against the US$ by 1.82%. However, according to economic correspondents, there is a strong assumption that the European Central Bank (ECB) will try to slow down this so-called Euro rally in order to maintain and strengthen its pro-export trade policy.
In morning of 1 October, the EUR has not only appreciated its exchange value against the USD, but also against other European currencies, including the British pound (GBP). On the same day at 8:44 am CET, the EUR/GBP currency pair traded on the foreign exchange – Forex market at a mutual exchange rate of GBP 0.0907 per EUR, with a daily appreciation of the EUR by +0,07% of the exchange rate against GBP.
According to analysts, the EUR/USD currency pair is currently looking good, but significant gains may remain elusive as the ECB is looking to align its inflation strategy in line with the Federal Reserve System (Fed). On Wednesday, 30 September 2020, the President of the ECB said that targeting inflation at an average of 2% could strengthen the ability of monetary policy to stabilize the economy when facing the lower limit. The Fed adopted the average inflation targeting in August – a more relaxed approach to controlling inflation. Under the new strategy, the Fed plans to keep rates low for some time after inflation rises above the 2% target. According to economic correspondents, the ECB is now following a similar path, which, according financial strategists’ estimates, will not allow the Euro exchange rate to rise above US$ 1.20 per EUR.