Forex Europe News – Delay on aid squeezes Euro

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Euro zone Finance Ministers during the EcoFin meeting have decided to postpone the decision for additional aid to Greece. The delay has weighed on the single currency which during the last hour has plummeted losing some 45 pips to hit a low of 1.4190 against the US Dollar. The delay mainly occurs due to disruptions in the Greek parliament concerning new austerity measures and fiscal reforms which are the terms set by EU/IMF in order to disburse the fifth tranche of the bailout. Many investors have turn to safe haven assets as uncertainty over peripheral debt burden has created risk aversion in the markets. However it is widely expected that the European policymakers will eventually and in time release the fifth tranche and they will extent the emergency loans, the deadline for the Greek debt is on mid July. Rumors say that EU has mapped to add pressure to the Greek Prime minister and parliament in order to proceed immediately with the needed fiscal reforms. The EURUSD has rebounded slightly as it is now trading at 1.4208, facing resistance at the area of 1.4220.