The markets are currently wondering about the evolution of the euro and the dollar. The appreciation does not seem to correspond to traditional explanations of currency movements by economic growth differentials. U.S. monetary tightening is expected to begin with a gradual reduction in asset purchases by the Fed, which is currently taking place at a pace of $120 billion per month.
For its part, the ECB announced the reduction of its asset purchases. The increase of 500 billion euros in asset purchases, bringing the pandemic-related purchase program (PEPP) to 1,850 billion euros was announced by Christine Lagarde on 10 December last year. His statements suggested that the Eurosystem would do everything possible not to spend the envelope, which should last until March 2022.
Unlike the Fed, the ECB is always slower to form or change its economic diagnosis and to adapt its action. Where the Fed sees a risk in doing too little rather than too much on monetary and fiscal matters, the ECB seems mainly concerned about the opposite fear. The coming days will reveal who will flinch between the Fed and the ECB