Diagrams of euro exchange rate to ruble and dollar

The diagram of euro exchange rate to ruble

The diagram of euro exchange rate to US dollar

2017: Reduction of use of euro in a world financial system

In the middle of 2017 representatives of the European Central Bank are concerned by the fact that the single European currency began to lose the positions in a world financial system. The following fact is given as an example: for the last year euro began to be used less as the international currency. The most significant recession happened in application of euro as funding currency.

Meanwhile, there are no economic reasons for depreciation of euro. Moreover, the economy of the eurozone which was very long accused of marking time at last began to grow. At the same time growth rates of the European economy for July, 2017 exceed growth rates of economy American.

The agreement of intent can give additional support of euro to create a zone of mutual free trade which Japan and the European Union signed on the eve of the G20 summit in Hamburg. And though it is only the political statement so far, it, undoubtedly, will affect strengthening of positions of euro.

The most probable causes why euro loses positions in an international financial system, lie in the field of policy. In 2017 Europe was included into the next electoral period. At the same time volatility of foreign exchange markets is affected more by expectations, but not results of elections.

Forecasts of political experts confirm ended campaigns in the Netherlands and especially in France: right-wing parties, populist politicians and eurosceptics lose votes. However financial markets to the last try to win back even the minimum chances of their victory. It confirms rapid increase in demand for euro right after Emmanuel Macron's victory.

Therefore after completion of elective campaigns in Germany, Austria and Italy (there parliamentary elections take place no later than May, 2018 though exact date is not appointed yet) influence of political events on euro exchange rate will significantly decrease. More precisely, an exit of Great Britain from the European Union which should be finally issued in March, 2019 will remain the only factor of influence. And though Great Britain did not pass to euro, there are no doubts that Brexit in July, 2017 makes and will continue to make impact on dynamics of single European currency.

In addition to political risks, representatives of the European Central Bank are afraid of the growing popularity of currencies of emerging markets, first of all – yuan. It is necessary to recognize that certain bases under this concern are.

After imposition of sanctions and response countersanctions Russia began to look for new partners on the international scene, to be exact – to strengthen relations with traditional allies which also China treats. The getting stronger relations between the countries find the embodiment in joint projects. In particular, the Russian Direct Investment Fund and Development bank of China agreed about creation of joint fund in yuans for financing of different projects in the territory of Russia. For the first time other world currencies – either euro, or dollar will not be involved in the similar scheme.

The fact that euro loses positions as world currency for Russia has no value. Our country has enough problems with own currency. Besides after 2014 euro share in structure of the foreign trade balance was reduced. Also you should not forget that for the main Russian export goods – oil, gas, and recently also grain – calculations are performed in dollars, Oleg Yakushev considers, expert AO IK of TsERIH Capital Management.

At the same time optimism gives to representatives of the ECB the fact that world reserves grow in euro – their share at the end of 2016 made nearly 20% and can grow still. Taking into account that about two thirds of the world market of an external debt, the international loans and gold and foreign exchange reserves are the share of US dollar, it turns out that potential competitors of euro have no more than 15%. All this allows to speak about euro as about the second major world currency.

• Economy of Russia
• Eurozone economy
• Economy of the USA
• National debt of the USA