Euro is gaining today, even though concerns remain about Spain and other countries in the eurozone with high amounts of sovereign debt. Continued worries about the eurozone are not enough to keep the euro down as Forex traders show disappointment with US dollar policy.
Recently, gains for the US economy have led some Forex traders to speculate that the Federal Reserve would move up its timetable for interest rate hikes. This speculation, along with concerns about the eurozone, have kept the euro somewhat weak against the greenback. Now, though, with Fed officials squashing hopes of a hike, the euro is getting a boost.
Even though Spanish bond yields are up again, there are concerns about a eurozone recession, and there is a great deal of uncertainty as to whether or not the eurozone is really capable of staving off a full-blown crisis, there is enough risk appetite right now to support the euro. Additionally, with the euro’s better yield, and no expectation of an interest rate hike for the greenback, it isn’t a surprise that the euro is being preferred right now.
At 14:53 GMT EUR/USD is higher at 1.3174, up from the open at 1.3110. EUR/GBP is up to 0.8257 from the open at 0.8242. EUR/JPY is higher at 106.6350, up from the open at 106.0250.
If you have any questions, comments or opinions regarding the Euro, feel free to post them using the commentary form below.