The European economy hit a high against that of the United States as the euro inched towards a one-year high against the US dollar as April drew to a close.
The euro closed 0.08% ($1.104) against the US dollar on April 27th, just a touch lower than the one-year peak of $1.1096 it hit the previous day.
Indeed, the European economy showed great resilience – a stark contrast against the US’ ongoing debt ceiling impasse as well as the crises hitting mid-sized banks in the country.
A Flat Performance
According to the dollar index, the primary gauge of the greenback’s performance against six major world currencies, the US currency lay flat at around 101.41 after a drop of 0.39% the day before.
The US dollar has plummeted by more than 11% since September of last year when it hit a 20-year high. According to analysts, its fall has been precipitated by the possible end of the Federal Reserve’s rate hikes, the slowing down of inflation, as well as outperformance on the part of the European economy.
Capital goods spending in the US also fell further than previously estimated, prompting concerns about an economic downturn. This was compounded further by issues affecting the First Republic Bank which eventually declared failure as May rolled in, along with the congressional deadlock about raising the country’s debt ceiling.