Euro slips further toward one-to-one with dollar

[man on the moonshine]

Source: AP

By DAVID McHUGH
Dec. 20, 2016 10:30 AM EST

FRANKFURT, Germany (AP) — The dollar's upward march has sent the euro currency to its lowest level in 14 years, easing the financial pressure on traveling Americans but giving European exporters a boost.

The euro, used by 19 countries, was down 0.3 percent at $1.0367 mid-afternoon Tuesday, drawing closer to the psychologically important level of one euro per dollar, or so-called parity.

A major factor has been the prospect of more interest rate hikes by the U.S. Federal Reserve following a quarter point increase in its benchmark rate last week. Higher interest rates in the U.S. increase returns on dollar investments and spur demand for the currency.

European monetary authorities — meaning the European Central Bank in Frankfurt — have widened the rate gap further by extending stimulus efforts aimed at pushing market rates down. The ECB's benchmark remains at a record low of zero compared with the Fed's range of 0.5-0.75 percent.


Read more: http://bigstory.ap.org/article/91cc53b5789346928592bae4df85e521

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