The euro is the weakest in relation to the dollar in 23 months

After yesterday's press conference, Christine Lagarde, the boss European Central Bank, the exchange rate of the main currency pair EUR / USD fell below 2020 for the first time since May 1,08.

Investors could be disappointed with the ECB's attitude. Before the April meeting of the bank's decision makers, the market priced in that this year interest rates in the euro zone would rise by 70 basis points. After yesterday's communiqué and press conference of the ECB head, the valuation fell to 60pts.

ECB slow ...

The ECB's statement shows that the correction of interest rates in the euro area will be gradual and will start "some time after" the end of the APP net asset purchase program, which is expected to take place in QXNUMX this year.

The fall in the euro exchange rate and investors' moods may also be influenced by: the war unleashed by Russia, rising commodity prices, concerns about a slowdown in economic growth, as well as doubts about the outcome of the presidential elections in France. In the first round, the current president, Emmanuel Macron, did win, but the far-right candidate Marine Le Pen took second place with a slight loss and with a chance to win the presidency on April 24 in the second round.

EUR / USD exchange rate: spectrum of the 1,0000 level

All the above factors may have contributed to the fact that the EUR / USD exchange rate was falling to around 1,080 during Thursday's session, trying to recover on Friday. However, the pressure on the single currency may persist until the second round of elections in France, or Le Pen's victory could bring EUR / USD quotations even towards parity 1,0000.

The war in Ukraine also means that Europe, more than the United States, may be exposed to an economic slowdown, which may also leave its mark on the prices of the main currency pair. Another advantage of the dollar seems to be the tendency of the Federal Reserve to raise interest rates faster. The market is currently pricing in two consecutive moves of 50 basis points in the United States, which may maintain a large divergence in the monetary policy and translate into the EUR / USD exchange rate.