Euro Goosed Higher on Draghi Comments
Euro has jumped higher, goosed by the comments from European Central Bank president Mario Draghi. The ECB’s commitment to the euro is helping the 17-nation currency against the US dollar, and helping spur a bit of risk appetite.
Mario Draghi insisted that the ECB will do “whatever it takes” to prevent the euro from disappearing. Draghi’s confident tone is helping Forex traders decide that the euro will be saved, at all costs. As a result, the euro is heading higher, especially against the US dollar.
The news sent the euro above the 1.2300 level, even though EUR/USD is below that level right now. Euro is down against the pound, though. UK pound is still seen as something of a safe haven — even after the disappointment over Q2 economic data. Additionally, euro might not be able to sustain its strength in the near term, since there are still a number of hurdles to clear.
It will be interesting to see if Draghi interprets the ECB mandate as one that allows it to act unilaterally to save the euro using tactics that some of the eurozone participant states may not approve.
At 13:11 GMT EUR/USD is up to 1.2298 from the open at 1.2154, and off the high of 1.2318. EUR/GBP is down to 0.7833 from the open at 0.7844. EUR/JPY is up to 96.1180 from the open at 95.0305.
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Earlier News About the Euro:
- Euro Rallies on ECB Comments (2012-07-25)
- Euro Flounders on Germany, the Netherlands Credit Outlook (2012-07-24)
- 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)