The ECB policy is pushing the euro

Frankfurt Monetary policy in the USA and Europe is diverging more and more. This became particularly clear at the end of the year when the US Federal Reserve and the European Central Bank (ECB) met in quick succession.

The Americans want to exit the loose monetary policy much faster – ECB President Christine Lagarde and her colleagues, on the other hand, are taking much longer. That gave the dollar a solid tailwind in the second half of the year. At the beginning of 2021, the euro was still trading well above 1.20 US dollars – it is now just above the 1.10 dollar mark. Many experts expect the upward trend to continue. “The dollar ended the past year in a strong position, and the outlook for 2022 is promising,” said the head of foreign exchange at the major British bank HSBC, Paul Mackel.