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Euro is $1.12! When did that happen?

Kind of caught me by surprise. I am used to $1.25-$1.30.

Posted by
3317 posts

Quick, where will you be going this Spring? : )

Posted by
12084 posts

It happened a few weeks ago. Last week or so the figure stood at $1.11.

Posted by
15566 posts

The Euro has not traded above 1.20 for at least 1 year, and has slowly trended down since then.

Posted by
945 posts

I'm in California where my sales tax is about 9 1/2 %, so when the Euro is worth 1.12 it is practically a wash/even trade. (Not exactly but close enough, especially compared to 5 or more years ago.)
This makes me a happy camper!

Posted by
11676 posts

Sam jogged my memory; it was $1.20 when we were in France last August. But I like the $1.12.

Jean, we are leaving for Spain in 10 days, to go hiking in the Pyrenees.

Posted by
3117 posts

Cheering for the USD to keep getting stronger for all here who are traveling to countries whose currency is the €!

Posted by
3930 posts

When we first went on the Best of Europe trip, (2011), the euro was close to $1.50. Anything under $1.20 gets me excited.

Posted by
11389 posts

Bah humbug - is Canadians are still paying 1:60 or so ,

Posted by
2274 posts

We are in Rome now. We have found in the past that when the Euro is cheap prices just rise. But, so far, we are finding our costs are lower. Restaurants in particular are a relative bargain. We went for a splurge dinner last night at a great restaurant I had to book a month in advance. Three people, multiple courses, cocktails, two bottles of wine (don’t judge) 139 Euros!

Posted by
13902 posts

I must be a frequent flyer. I am always watching the rate. Lucky me, I'm either on my way to Europe or planning (and sometimes prepaying) for my next trip.

With the rate so favorable to my travel $$, I may take a stash while I'm in Portugal later this month so I'll have it waiting for my next trip - not that there's one planned but I still have a lot of places on my list and enough left in this year's travel budget for a fall visit.

Posted by
3930 posts

Chani, that's not a bad idea. We usually bring home some euros, so we have some in our pockets to start our next trip. There's a special kind of glee knowing you're paying with €s that cost you less. Of course, sometimes it works the other way...

Posted by
81 posts

I might have to exchange some dollars for Euros now for my trip in October. I usually do it right before my trip (My sister in law is a manager at a bank and can do it for me for no fees).

Posted by
3904 posts

Three people, multiple courses, cocktails, two bottles of wine (don’t judge)

I will judge, why wasn't there a third bottle?

Posted by
630 posts

It's going to get lower, although it may rise a bit peak season. Brexit, and the economies of Italy and Turkey are killing the Euro. If the anti-EU crowd wins big in the elections it will drop again. Balance that against the strong dollar and retail and housing prices dropping as the laws on outside investment curtail the amount of "free" money and this may be the best time to travel using Dollars since Reagan sat in the White House.

Posted by
11683 posts

It was $1.13 when I went to Ireland in May. The real deal is the pound right now at $1.21. I haven't paid attention but the Danish Kroner might be very cheap too. The dollar has been going up since the Fed started raising short term rates. People are thinking the dollar is too high but haven't done anything about it yet. I expect the pound to go up after Brexit is done, regardless of how it's done. The Euro will go up when their interest rates are on a par with ours. Right now several countries in Europe are looking at possibly negative interest rates.

Posted by
16743 posts

Today looks like a good day to buy things in euros or to pay off traffic tickets.

Posted by
23253 posts

This is a post from May. Looks like not much change to me

Posted by
1868 posts

I believe it was down to $1.11 when we left 5 days ago. Nice that it has stayed about the same. I can remember when it was $1.34 a number of years ago.

Posted by
5448 posts

And as August comes to and end and trade wars fester:
https://finance.yahoo.com/news/eur-usd-mid-session-technical-113043097.html

EUR/USD Mid-Session Technical Analysis for August 30, 2019

The Euro is trading lower against the U.S. Dollar on Friday, as
investors continue to price in aggressive easing by the European
Central Bank and ignored doubts by some policymakers about the need
for additional stimulus. Although the Fed is expected to cut its
benchmark rate by 25-basis points in September, this form of stimulus
is considered tame when compared to what the ECB may be planning.

At 11:17 GMT, the EUR/USD is trading 1.1038, down 0.0019 or -0.18%.

EUR/USD (EURUSD=X) CCY - CCY Delayed Price. Currency in USD

1.0988 -0.0073 (-0.6593%) As of 8:48PM BST. Market open.

Posted by
630 posts

The Fed is NOT going to lower the rate in SEP, Brexit is going to take the Pound Sterling even lower, and Germany is getting smoked as car sales dry up. China is limiting foreign investment, Spanish Banks are horribly exposed to Argentina where the peso is tanking, and Italy is without a government and a plan to attack the worst dept in Europe. The Euro is going to drop below 1:105 in the next year, and things are going to get ugly...

Posted by
3930 posts

James E, why do you want it higher? This is a serious question. I've never been able to wrap my brain around economics.

Posted by
5448 posts

Some politicians want a weaker dollar Fox Business reported Published August 06, 2019:

"China and Europe playing big currency manipulation game and pumping
money into their system in order to compete with USA," he wrote. "We
should MATCH, or continue being the dummies who sit back and politely
watch as other countries continue to play their games - as they have
for many years!"

Posted by
630 posts

Financial data from China is always suspect, and since their economy has slowed down they are trying to stave off popular discontent within the population which is not helped by the Uhgar and Hong Kong situations. What we see in the West is very different than the reporting within China. The yuan is facing difficulty because of this.

As for the Euro, it's a horrible example of really bad economics. Most countries have never met the financial requirements they are legally bound to and the economies of the various regions involved are too varied for the type of control Brussels dreams of. The failure to hold members to the agreements only makes the eventual failure of the currency more certain. The Euro cannot compete against the dollar on equal terms because of this, and if/when Brexit actually happens other countries will follow. (Italy's leaving will be even more chaotic; they can't even get a gov't to last 4 years, who thought having them join a long term project like the EU was a good idea?)

Interest rates are going to have to rise in the USA or inflation is going to be even more visible. Likewise, real wage growth is going to become an issue as the hidden inflation brought on by the increase in major asset values (houses, cars, etc) has drastically surpassed the Fed's "inflation" targets. Increased interest rates in the USA will create a stronger dollar (as the economy is growing) and there's going to be a huge number of businesses that are going to tank as "free" money (low or no interest loans) dries up.

Posted by
5448 posts

The weakening Euro with respect to the USD doesn't seem to be impacting short term Eurozone inflation rates:
https://tradingeconomics.com/euro-area/inflation-cpi (August 31, 2019):

The annual inflation rate in the Euro Area came in at 1 percent in
August 2019, unchanged from the previous month and in line with market
consensus, a preliminary estimate showed. It remained the lowest
inflation rate since November 2016, as cost of energy is expected to
fall while prices of food, alcohol & tobacco and services are seen
rising further. Inflation Rate in the Euro Area averaged 1.99 percent
from 1991 until 2019, reaching an all time high of 5 percent in July
of 1991 and a record low of -0.60 percent in July of 2009.

Posted by
12084 posts

True, the rate stood at $1.11 but prior to that the rate was also at $1.08 some 2 weeks ago. I'm glad I changed 1200 Euro when the rate was at $1.11....all liquid ready to go now.

Posted by
10672 posts

Jane, cause it's good for business. And as her the statement, "Some politicians want a weaker dollar", ignores the same feelings held by many business people and financial experts.

Personally I can stand 2% more on my vacation in return for a more sound economy.

Posted by
10672 posts

Interest rates are going to have to rise in the USA or inflation is
going to be even more visible

The rate should be more visable so people can appreciate how solid the economy is.

Its 1.6%, tough to do much better.

Posted by
630 posts

"Personally I can stand 2% more on my vacation in return for a more sound economy."

Personally I'd prefer to have an economy that paid me 3-4% on my savings so I could take a vacation.

Low interest rates prop up poor business models and are especially hard on the middle class. Forcing the wage earners into a debt cycle by increasing the cost of major assets while limiting corresponding wage growth hurts everyone!

Posted by
10672 posts

KGC, past year my return has been double digits. Past 10, or even 20 years, I have done a tad better than 7% annualized. You need to find something better to do with your cash. Granted 2008 through 2016 was pretty dismal, but things are looking better. The devalued dollar helps by making our exports cheaper which creates jobs. Of course, everything in moderation. Oh, and wages are increasing at rates not seen in more than 20 years. Personally that worries me a tiny bit. As for assets, plenty of cheap cars and houses, but you are correct, cheap money means people will choose to over extend. Short of socialism, not sure what to do about that.

Posted by
335 posts

So just for a nb: I went to the AAA travel store in Seattle yesterday to buy some Euros before our trip. I was charged $1.17 per. When I asked why so high, I was told that it was the "consumer rate" and that was the lowest they'd seen it in some time.

-- Mike Beebe

Posted by
10672 posts

Today Visa charges $1.1062 per Euro, which means BoA is going to be about $1.12.

Posted by
4855 posts

@Mike, I was told by one AAA office, that they sell currency based on the rate they paid for that batch of currency, regardless of the daily market rate. I think each state's AAA is independent so they all do different things.

Yes its great for travelers, but instability is bad for all economies in the long term. Somebody loses.

Posted by
2760 posts

Granted 2008 through 2016 was pretty dismal, but things are looking better.

Really? My IRAs did very well in that time period, as did those of most people. Meanwhile, the majority of economists are now predicting a recession in the next year or so.

Posted by
273 posts

Really? My IRAs did very well in that time period, as did those of most people. Meanwhile, the majority of economists are now predicting a recession in the next year or so.

That's my experience as well. I lost half of my 401K investments in the great 2008 recession and completely recovered them (and well beyond!) during the 2009-2016 time period. In fact, the fantastic performance of 2009-2016 is funding my retirement travels. I wouldn't have been able to deal with the roller coaster market of the past 2 years and have never regretted moving everything to a safer investment. I agree that our economic indicators are far from rosy for a number reasons.

Posted by
1122 posts

Since I'm signed in I thought I'd chime in on the stock market.

Interest rates have been artificially low since 2009/2010--QE anyone?

Therefore, you ain't getting no return on savings. So where ya gonna go? Stock market.

What makes a stock price go up? More buyers than sellers, and vice versa.

I think it is that simple. No, really, it is.

Posted by
11676 posts

So is the euro going to continue to drop? And the pound sterling? I need to book and pay deposits on apartment rentals in Venice and London for our March. I am tempted to do it soon, but not too soon. Who has a crystal ball they trust?

Edit: I see the pound at $1.23 is up a bit from a week ago, when it was $1.20.

Posted by
12084 posts

If it's $1.12 offered by BofA for no fee if a minimum of one thousand Euro are withdrawn, I can live with that easily, much better than at $1.18.

Posted by
10672 posts

And Fred, if you sign up for their Wealth Managment program there is no minimum with no fee. But I suspect you can still do a bit better with an ATM. But, since I earn some money in Euro, I would prefer 1 to $1.25 :-)

Posted by
12084 posts

@ James...it's all a matter of perspectives and the buying power.

Posted by
10672 posts

Yup. A strong Euro isnt good for tourists, but the US factory workers enjoy it.