Investing.com - The euro spiked to its highest level since January 2015 earlier this week, which in turn sent Germany's DAX to its lowest in six months, amid speculation the European Central Bank was moving closer to tapering its asset purchase program.
The euro hit a two-and-a-half-year high of 1.2069 against the U.S. dollar on Tuesday before edging back below the 1.19-level on Thursday.
The single currency had strengthened since ECB President Mario Draghi’s speech at Jackson Hole last Friday. Though Draghi gave no fresh monetary policy cues some investors interpreted his lack of comment on the recent strength of the euro as an indication that it would continue to climb.
Hopes that the ECB will soon announce plans to taper its bond-buying stimulus program have driven the single currency up around 6% against the dollar since June, while the DAX has slumped about 5%.
The ECB has said it will announce in autumn if it will extend the asset buys, known as quantitative easing (QE) and launched two and a half years ago to bring down borrowing costs, revive growth and prop up inflation.
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