The EUR/USD pair traded between 1.0521 and 1.1052 in April, ending the month at 1.0780. The Fed signaled that interest rates would remain low until inflation reaches the 2% target, likely pushing a rate hike into the fourth quarter of 2015. EUR/GBP fluctuated between 0.7164 and 0.7380, closing at 0.7215, as slowing UK inflation hurt the pound while mixed economic data provided some support. EUR/JPY saw movement between 126.10 and 131.51, ending at 128.05, as geopolitical risks benefited the yen and lack of progress in Greek debt talks weighed on the euro. The EUR/

1. FX MONTHLY UPDATE
APRIL 2015
By: Tefkros Papas
Group Inst Wealth Management
Capital Markets Execution
EUR/USD
Monthly Low: 1.0521 High: 1.1052. Current market price: 1.0780.
The Fed cut its GDP forecast and mentioned that interest rates will not be raised until inflation climbs above 2%.
Yellen added that any such decision will be data-dependent. And since most recent US data was weaker than or
below expectations, concerns were raised that an interest rate hike will not be seen till the last quarter of the year.
Most of the moves in EUR/USD were dictated by US data and the progress of Greece in dealing with its debt.
Slight support for the dollar was derived from the FOMC minutes showing that there was a split decision to raise
rates in June.
EUR/GBP
Monthly Low: 0.7164 High: 0.7380. Current market price: 0.7215.
Sterling was hurt by the slowing UK CPI (0.0% y/y) which put Britain on course for its first period of falling
consumer prices in more than half a century. BoE minutes showed that the members were divided on the inflation
outlook, putting more pressure on the pound against mainly the USD. In addition, some funds decided to reduce
their holdings in GBP assets as they await for some more clarity on the outcome of the UK election. The GBP was
supported by the better than expected Q4 GDP, the rise in services growth and the pick-up in house prices.

2. EUR/JPΥ
Monthly Low: 126.10 High: 131.51. Current market price: 128.05.
The rise in geopolitical risks (Saudi Arabia – Yemen) and the fact that the BoJ kept its policy unchanged were
supportive for the yen. EUR/JPY was also sold following the lack of progress between Greece and its debtors.
There was some yen selling after Japan’s core prices came in lower than expected, mainly due to the falling oil
prices.

3. EUR/CHF
Monthly Low: 1.0264 High: 1.0495. Current market price: 1.0265.
The downtrend in EUR/CHF kept on as the market has slowly got over the negative interest rates and the CHF is
being bought against the Euro. The SNB’s task is very difficult now since it has two options: a. Contact FX
interventions, b. cut the rate further. Both tools need to be used wisely since the bank has almost reached the end
of the line.
EUR/RUB
Monthly Low: 52.5700 High: 62.9220. Current market price: 55.54.
The moderate rise in oil prices and the ongoing domestic taxation period have helped the RUB to recover. In
addition, the rouble gained substantially against both the USD and the EUR, as banks borrow FX from the CBR
(through FX repo operations) and use them to buy local bonds in anticipation of interest rate cuts. The RUB
appreciation came to an alt as the CBR increased the FX repo interest rates. Furthermore, following the
stabilization of the FX market outlook and the high interest rates locally, people started selling foreign currency.
Around $4.3 billion was sold in Q1 2015 versus purchases of $10 billion in Q4 2014.