The Euro traded steady on Friday but was still in the phase for a weekly rally but the European Central Bank's announcement that it would stop its stimulus in stages did not give too high support to the Euro.
At the same time, the market also expressed concern over the stabilization that could arise from the Russia-Ukraine conflict that continues to add pressure on the Euro currency.
The US dollar index, which measures the major currency against six other currencies, was still strong by 0.06% at 98.552.
After four consecutive weeks of declines, the euro soared this week when the ECB said it would phase out its stimulus in the third quarter, opening the door to an interest rate hike before the end of 2022 to combat soaring inflation.
Although the strengthening of the Euro was limited and not as expected, but according to Chris Turner, Head of Global Markets at ING, before this (non -war situation) EUR/USD often recorded gains following hawkish announcements.
Negotiations between Ukraine and Russia on Thursday did not show so much significant progress towards ending the war which is now entering its third week. To date more cities in Ukraine have been the target of Russian airstrikes on Friday, local authorities said, in a move that suggested Moscow expand its attacks into the country.
It is based on indications new satellite images appear to show that Russian troops approaching Kyiv have been deployed to the city and rural areas, potentially signaling a new push to destroy the capital.
Both the Central Bank of the Fed and the Bank of Japan will hold policy meetings next week. The Fed is expected to raise interest rates and the BOJ is likely to remain unchanged.
On the other hand the commodity currency was only slightly limited after the recent rise was driven by higher commodity prices, the Norwegian currency and the Canadian dollar were unchanged, while the Australian and New Zealand dollars depreciated slightly.
