Forex: EUR/USD bounces from 1.3586 low to 1.3650 zone

Last October, we set out our views on the evolution of the single monetary policy in 2013. “In line with our macroeconomic forecasts, our base case was for unchanged ECB policy rates throughout 2013 (and indeed to the second half of 2015). The biggest risk we identified to this view came not from further weakness in economic activity (whether in the periphery or the core) or even the emergence of growing deflationary pressures.” notes the Economics Research Team at Goldman Sachs. Rather, we saw the most likely driver of a rate cut as being a brutal appreciation of the Euro exchange rate (to employ the language of former ECB President Trichet).