More to euro's destiny than ECB policy

The euro rebounded against the US dollar in April. Although expectations of a rate cut from the ECB began to build, Europe’s single currency was supported by a reassessment of how quickly the US FOMC would scale back its asset purchases. The euro was also buoyed by an improvement in sentiment towards the euro-zone: there was a sharp decline in the cost of insuring against a default by the Spanish and Italian governments relative to the cost of insuring against a default by the US government.