According to Deutsche Bank Asset Management, movements of the dollar and the euro is influenced by political events rather than the economic situation.
For example, since the inauguration of US President Donald Trump, the US dollar index, which shows the dollar's value against the six major currencies, has fallen by about 11%. Now, it is at the lowest level in the last 2.5 years.
At the same time, the euro has been steadily growing since April 2017, and now the single European currency is at its maximum since January 2015. Last week, the euro fell to 1.200 against the dollar, but since then it has almost completely recouped the lost points.
Analysts at Deutsche Bank believe that according to the data, the dynamics of the dollar and the euro was mostly influenced by political events such as elections in the US and France.
In the message to its clients, the Deutsche Bank team stated that current exchange rate fluctuations are not based on economic factors or on the interest rate level. This time it's political. The currencies reacted sharply to the victories of Donald Trump and Emmanuel Macron. These events changed investors’ perception in Europe, experts added.
