Posts Tagged: Interest Rates

The European crisis continues to affect the entire world, especially as the disputes between France and Germany do not seem to get to an end. The two countries have different perspectives upon the way in which the sovereign debt crisis in Europe should be solved and it is likely that we are not to make any mistake by saying that the financial crisis and the decrease of the Euro is not to get to an end unless the two countries find a common solution.

The problem these countries need to solve is that of whether they should share debts amongst the Eurozone states or to simply impose austerity measures upon the countries which are already faced with financial issues. The fact is that, unless they find a solution to this problem, the Euro will continue to remain in danger. The Euro has had a difficult week due to these events and it continues to trade influenced by Read more »

The European Union’s financial crisis continues to be incredibly strong, having a very powerful impact upon the Euro which has now dropped for the 4th week in a row. The European currency decreased especially against safe-haven currencies such as the Japanese Yen or the US Dollar. As well, based on the fact that even the safe-haven currencies are weak at the moment, it seems that the Euro has also fallen against the Great Britain Pound which seems to be the most powerful European currency at the moment.

Moreover, as there are no signs that the European crisis is to end in the near future, the Euro is likely to continue to fall in the near future. The Italian borrowing costs have reached the highest level since 1997, which has once more reinforced the concerns related to the debt crisis. As far as the analysts see it, the spreading of the crisis is now no longer limited to the Read more »

The effects of the economic problems around the world can be seen in the latest evolution of the Australian Dollar. The problems around the world have caused all economies to weaken due to the decrease in demand and to the concerns of investors. The Australian Dollar has ended a week of losses against most of its major counterparts, especially the US Dollar and the Euro. This is both due to the negative fundamentals Australia is faced with at the moment and to the decision taken by the Australian Central Bank of cutting the value of the interest rates.

It is important to know that the Australian Dollar is very much dependant on the way in which commodities perform due to the fact that Australia’s economy is based especially on exports. The fact is that commodities are under a lot of pressure at the moment due to numerous negative factors around the world. One of the main issues is Read more »

The end of the Group of Twenty summit has had a powerful impact upon the trading sentiment, causing the evolution of some currencies to change. This G-20 summit was supposed to find solutions for the sovereign debt crisis in the Eurozone and for the banks in the region. Up to now, the only result we know concerning this summit is that the members of the 20 European countries have refused the idea of a forceful restructuring of the Greek debt. It seems that the plans made by politicians did not manage to persuade investors of this thought. Moreover, the market has been affected by the decrease of the European manufacturing and services industries.

The result of this still blur outcome is that of influencing the trading sentiment, causing the risk appetite to grow once more. This has had a negative impact upon the US Dollar, which started to fall against its major counterparts as the safety need Read more »

As the situation in the European Union continues to be tensed, the trading market has a powerful reaction as the risk aversion has triggered a new wave of changes on the market. The safe-havens seem to be favored and the currencies around the world gain based on different speculations related to the evolution of the sovereign debt crisis.

The Euro has managed to regain a little of yesterday’s losses today on the speculation that the policy makers are to increase the rescue fund. The Guardian announced that Germany and France agreed to increase the European Financial Stability Facility from the level of €440 billion ($607 billion) to the one €2 trillion. This change is supposed to take place before the G-20 summit which is to take place this weekend. The Stoxx Europe 600 Index grew by 0.8 percent.

Moody’s has announced the downgrade of another credit rating, that of Spain. This has generated a wave of Read more »

This has been an important week for the Euro due to the fact that there were risks according to which the European currency is going to be faced with a tremendous fall due to the fact that the sovereign debt crisis continues to be important in the region and to the speculations regarding the European Central Bank’s decision concerning the interest rates.

The decision of the European Central Bank has been taken today and it was that of maintaining the same value of the interest rates, but of expanding the program of bond purchases. The announcement of this decision has caused the Euro to fall at the beginning, but the European currency has managed to rebound afterwards. The European Central Bank has announced today the fact that it leaves its target Minimum Bid Rate at the value of 1.50 percent, decision which has been forecasted by most of the market’s analysts, even though there have been some of Read more »

The Great Britain Pound has been faced with a difficult time today as a result of the fact that the economic growth has downgraded intensely. The situation in the entire world is rather difficult at the moment, with most of the countries being faced with a slow rhythm of growth and with sovereign debt problems which increases the concerns of the traders.

The fall of the Great Britain Pound comes as a result to the report of the UK Government today which indicates the fact that Britain’s economy has had a slower pace of growth lately, smaller than the one which has previously been estimated. This has increased the concerns related to which the Great Britain’s economy is very likely not to be able to survive without additional stimulus.

The report indicated the fact that the UK’s gross domestic product in the first quarter was changed from 0.2 percent to 0.1 percent. This has also occurred Read more »

The Euro has been shaken by numerous problems in the last month. The situation in the Eurozone becomes worse each day and the Euro has problems holding on to its counterparts. The beginning of this month has turned out to be just as bad for the Euro as the previous month has been. This is due to the sovereign debt crisis and especially to the situation in Greece. The week to come may be one of the most important ones in the evolution of the European currency as it is expected for the situation in Greece to come to an end at the end of the week, most likely a bad one. Concerns have grown even more after the moment yesterday when it has been announced that Greece has not been able to meet its deficit limit. The country is likely to face default in the immediate period and this could trigger the Euro down with it. The Read more »

The European zone is confronted with more and more bad news each day. Some of the problems associated with the making progress of the sovereign debt crisis and the bailouts of countries such as Greece are related to Angela Merkel, the German Chancellor, who has seen divisions over the problem of the bailouts in the Eurozone in the coalition government. There are some German politicians who are disgusted at the thought of sustaining other European countries in their debt crisis. This comes as a consequence of the fact that Germany already provides huge quantities of money for the indebted nations and in order to sustain the Euro on the trading market. This is rather normal as the German economy is the most powerful and the most solvent one in the Eurozone. As a matter of fact, at the moment, Angela Merkel is faced with interior problems as there are parties which sustain the Euro and others which are Read more »

The trading market has evolved in a rather unexpected way today, due to the fact that the USD started to grow against most of its major counterparts, managing to reach such growth levels as to cause the AUD to fall below parity. This comes as a reaction of the Federal Reserve Bank’s decision of purchasing bonds, which has immediately increased the interest for the US Dollar.

The US Dollar started to widely grow after the moment when the Federal Reserve Bank announced its decision of purchasing long-term securities. This decision caused an instant demand for safe-haven currencies, including the US Dollar, which completely took advantage by the situation. The Federal Open Market Committee decided to maintain the federal funds rate at the value of 0 to 0.25 percent. In its statement, the FOMC said the following: “The Committee intends to purchase, by the end of June 2012, $400 billion of Treasury securities with remaining maturities of 6 years Read more »