The weakening of the euro vis-à-vis the dollar during January and February was mainly attributable to a series of economic data releases over this period, which were mostly relatively favourable as far as the US economy was concerned. The US economy surprised commentators with very positive data on employment and output. Over the same period data releases for the euro area were more muted.
At the same time, new investors – notably hedge funds – were born out of the need for market-makers in previously unknown types of securities.