Gains of Euro Lost as Spain Postpones Request for Bailout
The euro gave up its earlier gains today as Spain disappointed the Forex market participants, postponing its request for a bailout. After so much talking about the aid, such move was not well-received by the FX market and the euro lost its ground.
There was so much speculation about the rescue for Spain that it was almost taken for granted by some traders. The indebted country is still likely to ask for aid, but the delay was disappointing for euro bulls. Spanish Prime Minister Mariano Rajoy explained that he needs to know conditions for the bailout:
When it’s known exactly what’s on offer, I will take a decision.
Earlier, the euro was stronger as Italian borrowing costs fell. Another reason for the euro’s earlier gains came from China. Chinese Premier Wen Jiabao said:
China is willing, on condition of fully evaluating the risks, to continue to invest in the euro-zone sovereign debt market.
EUR/USD was down from 1.2531 to 1.2507 and EUR/JPY declined from 98.61 to 98.34 as of 21:38 GMT today. EUR/CHF ticked down from 1.2009 to 1.2008, while its daily high was at 1.2011.
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Earlier News About the Euro:
- Draghi Prepares Markets for Possibility of "Exceptional Measures" (2012-08-29)
- Euro Sees Gains, But Upside is Likely Limited (2012-08-28)
- Euro Drops Following Antonis Samaras Meeting with Angela Merkel (2012-08-24)
- Euro Higher Even with Continued Economic Contraction in the Eurozone (2012-08-23)
- ECB Ready to Start Bond Buying? Traders Hope So -- Euro Jumps (2012-08-22)