Can the Euro Maintain its Gains?
The euro got a little bit of a boost earlier today, thanks to recent announcements by the ECB’s Jean-Claude Trichet. Additionally, German growth helped out as well. However, there are some questions as to whether or not the rally can be maintained.
Part of the announcement by Trichet was that the ECB would buy bonds in order to give governments of euro zone nations time to sort out their sovereign debt issues. The ECB continues to try to avoid more direct measures. This could work, but if it doesn’t, and individual governments don’t come through, it could mean that situation drags out — with the ECB finally stepping in anyway.
For today, there are some signs that the euro’s gains might slip in forex trading. With the latest jobs market news out of the U.S. providing disappointment, risk appetite is fading away, and could give the U.S. dollar a boost.
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