By Anna Rascouet Feb. 8 (Bloomberg) — The euro may have already peaked against the dollar this year and be heading for further declines for the balance of 2010, according to MIG Bank SA. The CHART OF THE DAY shows that in seven of the 11 years since the euro’s start in 1999, the currency reached its highest or its lowest annual levels against the dollar in January. In 2002, the euro reached its low on Feb. 1. The high for this year was attained on Jan. 13, when the 16-nation currency climbed to $1.4579, before dropping as much as 6.8 percent to a 2010 low of $1.3586 at the end of last week. “It’s interesting how few people realize the propensity for euro-dollar to post either the year’s high or the year’s low at the start of January,” Paul Day , chief market analyst at MIG Bank in Neuchatel, Switzerland, said in an interview. “Historical precedent may indeed suggest that the 2010 high for euro-dollar has already been made. It’s interesting how consistently this January effect has performed.” The euro fell 0.3 percent to $1.3678 on Feb. 5. The currency has dropped 4.5 percent this year. The median of 40 forecasts compiled by Bloomberg is for the euro to rise to $1.42 by year-end. (To save a copy of the chart, click here.) To contact the reporter on this story: Anna Rascouet in London at arascouet@bloomberg.net
Originally posted here:
Euro `January Effect’ May Signal Further Weakness, MIG Says: Chart of Day
