| Dollar Down Against Euro After Rescue Plan Greece |
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| Tuesday, 13 April 2010 09:02 | |||||||
Page 1 of 2 New
York - The dollar fell against the euro on Monday, amid news of a
safety net for the Greek euro zone, but the decline is limited by
concern that another member of the euro zone can now be facing severe
financial pressure.
The European single currency was at 1.3589 dollars at 2100 GMT, compared with 1.3497 dollars late Friday. Conversely, the dollar stabilized against the Japanese currency, increased slightly to 93.21 yen from 93.18 yen. Earlier the euro had climbed to 1.3692 dollars, the level last seen on March 18, as traders welcomed the euro zone's commitment to give Greece to 30 billion euros (41 billion dollars) in loans to help get out of a crippling debt burden. "Support is provided through a package of aid to Greece which provides enough support for the euro to dramatically improve the clarity and the possibility of improving the ability to finance itself in the Greek market as a consequence," said analyst with Credit Agricole, Daragh Maher. "But there is a question of resistance from the flank. How long would happen until the market focuses on the stories of other weak fiscal in the euro zone?" added. The questions appeared to weigh on investor sentiment late day trading, especially as Portugal, Spain and Italy were all - to one degree or another - that difficulties such as debt and Greece could be difficult to raise money in bond markets. "The European Union's support to reduce incentives for budget-strapped states to conduct strict austerity measures," the analyst warned Jane Foley of Forex.com. "This moral hazard ... again pointed to the inadequate fiscal controls in the system (European monetary). Road ahead for the euro to remain rocky." Agreement euro zone, coming out on Sunday, also had a positive impact on the bond market, where yields on 10-year Greek bonds narrowed to a 6.637 percent from 7.126 percent on Friday. At one point in Monday's yield fell to 6.498 percent. Interest rates are going to Greece to offer a new 10-year bonds, last Thursday, it jumped to more than 7.5 percent, the highest since the country joined the euro zone in 2001. The spread or differential with 10-year benchmark German bonds reached 3.46 percentage points at the end of Monday to more than 4.00 points last week. "Despite recent market movements show some improvement in sentiment, the next key test for the market will occur in Greek government securities auction a three-month and one year tomorrow," said Vassili Serebriakov of Wells Fargo Bank. In late trading in New York, the dollar was at 1.0593 Swiss francs, down from 1.0658 on Friday. The pound rose to 1.5368 dollars from 1.5377 dollars. | Antaranews.com | tenderoffer.biz |
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