The euro’s recent resilience against the U.S. dollar is being driven more by softness in the greenback than by underlying strength in Europe, according to Martin Kocher.
Speaking on Friday, the European Central Bank policymaker said Europe’s economic growth remains too weak to justify a genuinely strong euro. Instead, he argued that the dollar’s decline appears to be a key factor, adding that this weakness may be, at least in part, politically motivated from Washington’s standpoint.
Kocher also noted that Europe is increasingly being perceived as a safer haven than it was a year or two ago, a shift in investor sentiment that has further supported the euro’s performance in currency markets.
