Euro is gaining today, heading higher after a rocky week, thanks to hopes for a Greek bailout. Expectations are that a Greek debt agreement will be reached by Monday. The news has many Forex traders scrambling to enter long positions on the euro against the US dollar and the Japanese yen.
It’s been a difficult week for the euro as rumors about what would happen with Greece have flown about. However, many now expect a deal to be finalized by Monday. German Chancellor Angela Merkel is hoping to avoid a two-step vote on the deal to ensure that it is accomplished faster. Some analysts think that the euro could shoot up quite a bit higher next week if eurozone leaders announce a deal.
The flip side, though, is that the euro could tank if a Greek deal doesn’t go through. Long-term, the euro also has other issues to deal with. Eurozone economic growth remains sluggish. Additionally, Greece isn’t the only country with sovereign debt problems. Other countries could soon be in a similar position.
The news about Greece is engulfing all else, with the news of the resignation of German President Christian Wulff barely causing a blip, and few people even paying attention to US economic data.
At 15:51 GMT EUR/USD is higher at 1.3160, up from the open at 1.3131. EUR/JPY is higher at 104.4235, up from the open at 103.6425. EUR/GBP is up to 0.8322 from the open at 0.8310.
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