(Yicai Global) Oct. 30 -- The foreign currency market has been particularly volatile over the past month, with the dollar rebounding as euro bulls flee the market and investors looking to put more emphasis on future prospects,

The dollar index had risen about 3 percent this month as of yesterday, while the euro dropped 2 percent against the greenback during the period and the yuan picked up by 0.4 percent. The yuan began a descent against the dollar after the European Central Bank decided to cut its easing program four days ago.

The dollar rally is closely related to weakened expectations for a rising euro, some market participants suggested, adding that the ECB may have intentionally leaked the information several weeks ago, worsening the euro's descent.

The ECB will halve its monthly bond purchases to EUR30 billion (USD34.9 billion) from next year, but increase the length of its purchase to last until at least September 2018, it said, adding that it did not rule out other changes. This dovish stance has made the euro a victim again, Zhou Hao, chief China economist at Commerzbank AG [ETR:CBK], told Yicai Global.

"The euro will remain weak for a while," predicted Huang Jun, a foreign currency analyst with Gain Capital Holdings Inc. [NYSE:GCAP].

The yuan has managed to remain relatively stable amid slight fluctuations. "Given a reversal in the expectation for a declining yuan and the introduction of counter-cyclical factors, the yuan's exchange rate is more likely to move in both directions, rather than just one," said Liu Yaxin, a macroeconomic analyst at China Merchants Securities Co. [SHA:600999]. The vast majority of institutions project the yuan's exchange rate against the dollar at between 6.6 and 6.75 by the end of this year.

"Compared with other Asian currencies, the recent fall in the yuan seems to be delayed," said Zhou Hao. "Possible smaller declines can't be ruled out, but the yuan will remain stable overall. Commerzbank expects the yuan's exchange rate against the dollar to be 6.75 at year-end.