The Euro fell to 1.1200 against the USD on Wednesday, the lowest level since July 9, amid rising expectations of monetary policy easing. The European Central Bank will deliver its monetary policy decision next week and investors await plans for fresh monetary stimulus. On Tuesday, the ZEW Indicator of Economic Sentiment for Germany deteriorated more than expected to its lowest since October last year, pressuring the currency. Since the beginning of the year, the currency weakened 2.2% against the dollar and is one of the worst performing currencies this week, along with sterling. The Euro edged up 0.1% to $1.1218 around 12:00 pm London time, after Eurozone June’s annual inflation was revised up and construction output slowed more than expected in May. Historically, the Euro Dollar Exchange Rate - EUR/USD reached an all time high of 1.87 in July of 1973 and a record low of 0.70 in February of 1985. The euro was only introduced as a currency on the first of January of 1999. However, synthetic historical prices going back much further can be modeled if we consider a weighted average of the previous currencies.
The Euro Dollar Exchange Rate - EUR/USD is expected to trade at 1.13 by the end of this quarter, according to Trading Economics global macro models and analysts expectations. Looking forward, we estimate it to trade at 1.12 in 12 months time.