Home > All > Forex Market Review – Euro tumbles as euro zone debt concerns return
Posted on June 11, 2012 by Trading Point Investment Research Desk at 8:02 pm GMT
The euro extended losses against the dollar during the U.S. session after hitting a three-week high earlier on Monday in a knee-jerk reaction to news that Spain will receive EU financial assistance to recapitalize its banks. However, as the day went on, the optimism faded as investors focused on the deal’s obligations. What the bailout deal has done is burden Spain’s government with additional debt and already high borrowing costs could rise further. Spanish bond yields edged higher again today, 10-year yields up at June 1 levels.
EURUSD declined to a low of 1.2482, down 1.4 percent in the day after briefly trading above the $1.26 level. The single currency remains vulnerable ahead of the Greek election on June 17, and the outcome will determine whether the country remains in the euro zone.
Sterling reacted negatively s to euro zone developments and a shift in risk. GBPUSD fell in New York trading to a low of 1.5490 unable to hold onto gains made earlier in the day when the pair traded above 1.5522.
EURJPY is trading worse than where it was before the Spanish bailout. Against the yen, the single currency, which hit its highest level in three weeks in the Asian session, last traded flat at 99.16 yen, filling the gap from this morning when the pair opened 1.2 percent higher from Friday’s close. USDJPY traded sideways during the U.S. session, trading a 79.35/55 range.
USDCAD surged to 1.0314 from the day low of 1.0200 as the safe haven U.S. dollar rose against most risk currencies today. Tumbling oil prices also weighed heavily on the commodity-linked Canadian currency since crude oil is a major export. Crude fell by over US$5.
Most Read News
- No results available
