Euro Pulls Back and Consolidates Before Heading Higher
Euro is pulling back a bit today, consolidating recent positions and looking for a solid level of support. The main concern right now centers around what’s happening with embattled eurozone countries.
Focus has shifted away from the European Central Bank, and plans for bond buying, to the actual situation on the ground in embattled eurozone countries. Instead of looking at the European Stability Mechanism, there are concerns about what is happening in Spain and Portugal. Citizens are protesting austerity measures, and that is providing doubt for politicians.
Spain has been encouraged to ask for aid from the bailout fund, but leaders are reluctant to do so, since that aid comes with austerity strings attached, and the Spanish politicians aren’t quite ready to go against a protesting citizenry. The result of this delay, and concerns that the individual politicians are balking, are weighing a bit on the euro.
The euro is in more of a consolidation phase, looking for some level of support that is consistent with the current focus. The 17-nation currency has managed to pull ahead against the US dollar after some drops, but the situation remains precarious and risk appetite has faded a bit.
At 13:14 GMT EUR/USD is up to 1.3130 from the open of 1.3121. EUR/GBP is still lower at 0.8083, down from the open at 0.8088. EUR/JPY is up to 103.4560 from the open at 102.7900.
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Earlier News About the Euro:
- Euro at Four-Month High Following Fed QE Announcement (2012-09-14)
- Euro Hits a Wall as Uncertainty Returns (2012-09-13)
- Germany Approves Eurozone Bailout Fund, Lifting Euro (2012-09-12)
- Euro Surges on Expectations that Germany's High Court will Back the ESM (2012-09-11)
- Euro Weakens as Troika Withholds Bailout for Greece (2012-09-10)