Foreign investments and potential travel costs are the top two reasons to keep an eye on the Euro exchange rate. With the economy being as unstable as it is at the best of times, there must be some way to spot market trends. Of course, monetary value is not a stand-alone entity, so there are many factors influencing the exchange rate – some of which are fairly easy to spot.
The influx of foreign trade is probably the best way to predict an increase in the Euro exchange rate. If there is a high demand for European products in other countries, the exchange rate is almost guaranteed to skyrocket. Because of its vast cultural scope, Europe has a wide range of products that are highly sought after around the globe. It comes as no surprise that the Euro is steadily increasing in value.
Something else to keep an eye on would be the interest rates in Europe. A high interest rate creates a higher return on investments, bonds and gilts. This, in turn, will boost the overall value of any particular currency. Overseas companies will spot this high value and will then pump funds into the country in question. Europe’s current list of foreign investors is impressive enough to keep the value of the Euro quite high.
All in all, the Euro exchange rate does seem to be strengthening at present. In the last few years, there has been a significant increase in value.