Euro Advances on Bailout for Cyprus, Drop Is Still Possible

  March 25th, 2013 at 11:30, Vladimir Vyun

Euro banknotes rolled upThe performance of the euro shifts and changes as Cyprus continues to remain in the spotlight of the news and the future of the country remains uncertain. For now, the currency has the upper hand, but some analysts are worried that it will not be able to retain the gains.

Cyprus will receive a bailout worth €100 billion. The terms of the deal include losses on deposits over €100,000, but does not mention a bank levy, which many investors have feared. Still, economists are concerned that the confidence in the country’s banking system is already damaged. The euro rallied today on the news about the financial aid, but came off the daily highs and shows potential to go even lower.

EUR/USD was up from 1.2946 to 1.2993 as of 11:30 GMT today, but retreated from the high 1.3047. EUR/JPY traded at 123.15 after rallying from 122.19 to 123.83.

If you have any questions, comments or opinions regarding the Euro, feel free to post them using the commentary form below.

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