Despite the fact that the fundamental data in the Eurozone has improved, the Euro did not manage to grow based on the fact that the European sovereign crisis continues to have negative effects upon the currency. The fact is that the market continues to be influenced by a feeling of risk aversion which is mainly caused by the difficult economic situation in the world, especially in the European Union. Even though the fundamental factors have shown positive data for the EU countries this week, the Euro remained flat for a period and started to fall afterwards. The consumer price index in France increased to 0.3 percent on a monthly basis in November, after the previous growth of 0.2 percent which has been seen in October. The ZEW economic expectations index for Germany also increased from -55.2 to -53.8 this month. Also, the same indicator has shown improvements for the entire European zone, growing from -59.1 to -54.1 even Read more »
Posts Tagged: USD
The European sovereign debt crisis continues to have major effects upon the trading market, causing the evolution of most of the major currency to fluctuate a lot based on the fluctuations of the trading sentiment.
The most affected currency is probably the Euro, which has finished another bad week. Friday, the Euro rallied a little, but did not have much strength. This rally has been the result of the European Union summit which has brought European politicians together in a new attempt of trying to find solutions to the sovereign debt crisis. This summit has actually brought some solid decisions such as the leverage for the European Financial Stability Facility which “will be rapidly deployed” and implemented by the month of July 2012 by the means of €200 billion which will be provided by the International Monetary Fund. This news has caused the enthusiasm of traders, but the currency did not manage to sustain a long rally. Read more »
The previous trading week has been dominated by an increasingly good sentiment which has known quite an expansion at the end of the week. This risk appetite has had quite a negative effect upon safe-haven currencies throughout the week, causing the most damages to the US Dollar which is already in a difficult situation due to the fact that banks all over the world are doing their best in keeping the value of the currency low so that the global economic crisis does not have so many bad consequences upon their economies.
Friday was the first day when the US Dollar started to grow a little, suggesting the fact that the risk appetite sentiment may be over. This growth has also been correlated with the fact that the European concerns are not yet totally over and with the fact that the fundamental data concerning the US showed some positive figures. The US manufacturing PMI grew from 50.8 Read more »
The two most important currencies in the world, the Euro and the US Dollar are now faced with quite a difficult period which causes them to fall against most of their major counterparts. The Euro continues to be influenced by the European sovereign debt crisis and its effects, while the US Dollar is falling on the growth of the risk appetite.
The Euro fell as much as hitting the 1.3400 level against the US Dollar, rally which the currency did not manage to maintain, despite the optimism related to the results of the Italian bond auction. This has caused the EUR/USD to fall behind the 1.3400 level, which means that the pair is likely to end the week at a lower level than the one it had started with. This means that all the gains that the Euro has managed to score during the very brief period of optimism have actually been rapidly erased. The optimism was the Read more »
The situation in Europe seems to be getting worse, increasing thus the sentiment of risk aversion which started to show again at the beginning of the trading week despite of the fact that it had turned at the end of the previous week. These new concerns have been caused by the increase of the bond yields in some countries and to the bad economic news. If we are to look at the situation at the moment, it is quite obvious that the European Union’s leaders will not be able to contain the sovereign debt crisis especially as financial markets are reacting accordingly.
The element which has determined the increase of the risk aversion feeling is the increase of the bond yields in the Eurozone. It is true for Italy, whose bond yields have continued to grow even though the European Central Bank has actually purchased some of the country’s bonds during the previous week in order to Read more »
The previous week has been dominated by the risk aversion which started to show on the market due to the situation in Europe. After the resignation of the Greek Prime Minister, the crisis started to really spread towards Italy as well, not only at the financial level, but also at the political one. After the vote which indicated the fact that the Italian Prime Minister, Silvio Berlusconi, is not wanted by the Italian citizens and after the sell of the Italian 10-year bonds, the market started to be dominated by an increasing risk aversion which seemed to calm down just a little at the end of the week. Traders are very concerned by the financial situation in Greece, Italy, Spain and Portugal and by the spreading political crisis, especially as there are rumors according to which Angela Merkel seemed to discuss with the other European leaders the possibility of quitting the unique currency for the Eurozone.
The risk Read more »
The European sovereign debt crisis continues with new types of manifestations. Even though most of the events which took place recently were mainly based on finding solutions as to improve the situation in Greece, which was becoming critical, it seems that there are also other regions which now need special attention as the financial and political situation in those areas is becoming worse than expected. One of these regions is Italy, country which is in deep financial problems as well. The fact is that it has been a while since Italy has been faced with economic problems, but the fact that Europe is now also confronted with political issues worsens the situation. The pressures related to the Italian Prime Minister, Silvio Berlusconi, and its political position have caused quite a stir of events on the trading market today, causing numerous currencies to act in a very volatile manner. At the moment, the pressure continues to manifest as traders Read more »
Despite the solutions adopted during the Group of Twenty summit, it seems that the problems in the European Union are still far from being solved. Moreover, the fact is that the concerns related to Greece did not manage to fade away, but those related to Italy have managed to increase and have caused a new wave of risk aversion among traders. There are obvious concerns related to the fact that the debt crisis is becoming contagious in the Eurozone, spreading from one country to the other. Based on this fact, the risk aversion has increased, causing the Euro to fall against all its major counterparts and the US Dollar to rise as safe-havens are trader’s first option at the moment.
It is today that the Greek Prime Minister, George Papandreou, has agreed to resign and to allow the unity government which is formed out of both ruling party members and opposite party members, take the needed decisions Read more »
There are more and more concerns related to the Greek referendum, especially as traders are aware of the fact that most of the Greek citizens are not satisfied by the austerity measures which have been taken along the time. This means that there are lots of chances for the referendum to have a negative result, which would mean that the Greek bailout will be to face problems. Moreover, traders are not satisfied with the way in which the situation in Europe tends to evolve not only due to the fact that the problem of Greece has not yet been completely solved, but also because it seems that Italy, Spain and Portugal are in no better shape than the Mediteraneen country.
This has generated a change in the trading sentiment, causing traders to feel a new wave of risk aversion. This has been a very productive situation for the safe-havens, but not such a good situation for the risk Read more »
Despite the decision taken during the Group of Twenty summit concerning the solutions to the European sovereign debt crisis, it seems that the situation in Europe is not yet solved as the fundamental data indicates the fact that the European Union’s economy has worsened. This piece of news has increased the concerns relating to which the Eurozone’s problems are too difficult to be solved in the near future.
It seems that even the German economy, one of the Europe’s most solid economies, has been suffering. The retail sales in Germany have increased by only 0.4 percent during September, after the 2.7 percent fall registered in August. Economists were expecting a growth by 1.1 percent, so this is quite a disappointing figure. The problems in Italy seem to have gotten worse, increasing investor’s concerns. The unemployment rate in Italy has grown to 8.3 percent in September from the 8.0 percent registered in August. According to Eurostat, the unemployment Read more »