Euro Flounders on Germany, the Netherlands Credit Outlook
Euro is floundering today as concerns about what’s next continue to plague the 17-nation currency region. Once again, the 17-nation currency is below the 1.21 level against the US dollar, and it continues to drop against the UK pound.
This time, some of the concern for the euro comes in the form of a downgrade to the credit outlook in Germany and in the Netherlands. Moody’s lowered its outlook for the two countries, recognizing that weaker countries in the eurozone would need support.
Lowering the outlook from stable to negative for two of the most economically respected countries in the eurozone is a move that indicates that Moody’s believes that the situation in the eurozone is dire enough that the weaker countries will drag on the stronger countries.
Next week, the ECB will make more policy announcements, and Forex traders and investors will be paying attention. There is a lot of pressure on European leaders to come to agreement, and find a solution. This latest move is just another pressure point on the eurozone. As long as doubt remains, the euro will continue to struggle.
At 14:47 GMT EUR/USD is down to 1.2087 from the open at 1.2117. EUR/GBP is down to 0.7786 from the open at 0.7814. EUR/JPY is down to 94.5100 from the open at 94.9850.
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Earlier News About the Euro:
- Euro Below 1.21 as Concerns for a Major Spanish Bailout Mounts (2012-07-23)
- Euro Continues to Struggle on Spanish Borrowing Costs (2012-07-19)
- Euro Heads Higher After Hitting Two-Year Low against US Dollar (2012-07-13)
- Is the Euro/Dollar Headed for 1.20? (2012-07-12)
- Euro Inches Higher - For Now (2012-07-11)