Turmoil In Europe Could Affect The Financial Markets Soon

Apr. 10, 2019 9:53 AM ETEEFT, EUFN, VGK, BCS, BNPQF, DB, DXYN, EURL, EUU, UBS4 Comments
Riccardo Zerilli profile picture
Riccardo Zerilli


  • Many European countries haven't recovered yet from the financial crisis of 2007-2008 like Italy, Portugal, Spain, Greece.
  • Lots of uncertainty for a Brexit Deal. UK parliament still has not approved Theresa May proposal and a NO Deal seems closer than ever.
  • European Banks for the past three quarters have reported negative numbers , like Deutsche Bank, and the ECB has kept interest rate at minimum without obtaining the expected results.

Most investors are currently keeping their focus on the trade deal between China and the United States, but something else needs some attention at the moment, something that comes from overseas. The European Union is on the verge of a series of events that could impact the financial markets in the near future. In this article I will provide my own analysis on three major factors that could have a big impact for the European markets and International markets. Most specifically, I will start by giving an update on the current situation of the Eurozone , than I will underline the most recent news on Brexit , and lastly I will shift my attention on two major topics: Governments debts and the wave of populism across the European Union. I will than conclude my article by giving out my personal suggestion for the European Union's future outlook.

Current situation for the Eurozone

As of April 5th 2019, the exchange rate between the Euro and the US dollar is 1.1215. The single currency has declined steadily since the U.S. Federal Reserve’s meeting in March. The sentiment reports from IG Markets, which is a UK-based company providing trading in financial derivatives such as contracts for difference and financial spread betting, strongly suggest that the euro is likely to move lower with a target around the 1.11800 area (FXWirePro).

Euro chart ( Courtesy of chartoasis)

Data by YCharts

After the Global Financial Crisis of the 2007-2008, the ECB started to lower interest rates in order to stimulate the economy of the European countries, and lowered the interest rate all the way to zero on March 2016. During the latest meeting on march 2019, the ECB confirmed that they will proceed in being cautious for the near future driven by the uncertainty of the global markets, most specifically the ECB

This article was written by

Riccardo Zerilli profile picture
"Investing in Financial markets requires great knowledge and discipline ". I seek to disclose my open research and analysis of new trends to help investors make the right decisions . As someone in possess with great passion and interest for the financial markets I tend to focus on both long/Short term trends . I deliver great and professional articles with the goal to help people deciding their investment goals. Much of my focus also involves mutual funds and the forex market. I obtained my bachelor degree in economics from the University of California San Diego and currently studying to become a CFA Charterholder. My intense experience in the research department alllowed me to develop great analytical skills and financial modeling skills.

Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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