A strong currency is a serious problem not only for the Russian government. The eurozone is facing the same issue now. While the Russian authorities have successfully coped with the task of bringing the ruble to the lowest possible levels, the ECB can not handle this problem. According to experts, ECB President Mario Draghi has small chances of stopping the euro growth.
Carmignac Gestion and JPMorgan Asset Management reports show that the upward trend will continue in the near future, and even the strong statements of Draghi at the economic symposium in Jackson-Hole will not affect annual growth of the euro against the US dollar, which is the fastest since 2003. At the same time, despite ECB officials’ concerns over the further strengthening of the single European currency, market participants are waiting for a statement about winding down the quantitative easing program in September or October. This makes any effort to restrain the euro growth ineffective. "The market will scrutinize any sentences by Draghi at Jackson Hole and we are very conscious of that," said Charles Zerah, fund manager at Carmignac, who is long the euro, particularly against the yen. “The euro should still perpetually appreciate.” This year the euro has gained 12 percent against the US dollar amid accelerating economic growth in the EU. In addition, the negative influence caused by political uncertainty, namely elections in France and Holland, that put pressure on the currency faded away. “Despite taking this verbal hit from the ECB last week, the euro continues to show the resilience of a boxer refusing to go down,” ING Groep NV analysts led by Viraj Patel wrote in a report.
