Euro – European Markets The single currency rallied and for a brief period nudged above the 1.31 mark against the US Dollar, after the Fed Chief indicated that the central bank would continue with its accommodative monetary policy for the foreseeable future. However, it has pared some of its gains and is trading below the 1.31 level against the greenback. On the macro front the ECB, in its monthly report, indicated that although recent economic releases have offered a grim picture of the region’s economy, the Euro zone would stage a recovery later this year. Moreover, the central bank opined that it has no intention to change its low interest rate policy any time soon. Meanwhile, appetite for peripheral bonds offered renewed cause for concern, as Italy’s short-term borrowing costs rose to the highest level since March 2013 after S&P demoted its sovereign credit rating on the nation by one notch yesterday. A similar rise in bond yields at today’s long term bond auctions could put the nation’s plan of raising cheap debt into jeopardy. With a seemingly lacklustre day ahead in terms of domestic economic releases, traders are expected to monitor overseas events for further cues to risk appetite.
Posted on: Thu, 11 Jul 2013 10:44:22 +0000
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