The Euro yesterday continued its decline on the foreign exchange markets, trading at a two-week low against the dollar, following the reports announcing the stagnation of the Eurozone economy in Q4 2009.
The Euro was trading at 1.3341 against the dollar at 9:01 a.m., on the New York market, compared to 1.3399 USD the previous day. The exchange rate had previously dropped to 1.3326 dollars - the lowest level since March 26th. On the Frankfurt market, the Euro would have an exchange rate of 1.3353 dollars around 13:00 local time.
Economists say that the Euro is overvalued and will continue to drop in the near future, as the risks threatening the region will not allow the ECB to raise interest rates. According to analysts, the ECB will decide today to keep the key rate at the current record minimum of 1%. The board of the ECB hasn"t changed the exchange rate since May 2009.
According to experts, the economy of the Eurozone will be slow to recover. "The first quarter was very weak, but the current quarter may bring an improvement", said Christoph Weil, an economist with "Commerzbank" AG in Frankfurt, quoted by Bloomberg, who said that this year, the growth in the region will be fueled by exports.
* OECD: The United States will recover faster than Europe
The economic recovery will slow down in developed countries, and the United States will grow at a quicker pace than Japan and Europe in the first semester of 2010, the OECD estimates (Organization for Economic Co-operation and Development).
According to the institution, G7 member countries had an economic growth of 1.9% in Q1 2010, compared to Q4 2009. The OECD expects a growth of 2.3% in Q2 2010.
The OECD expects the American economy to post a growth of 2.4% in Q1 2010, compared to Q4 2009, and of 2.3% in Q2 2010.
In the case of Japan, the OECD expects a growth of 1.
