Irish Get Rescue Can Not Change Euro Pessimism
- By Haven Frbiz
- Published 02/1/2012
- Latest
- Unrated
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Irish rescue plan in the first trading day after the publication of the euro against the U.S. dollar experienced significant volatility in the euro remains pessimistic about the prospects of the market is flooded with comments.
Doubts still, the euro fell further
Ireland finally concluded the rescue, but all is not settled, the euro's market performance is erratic. On Monday, the euro jumped against the dollar after the opening bell, but soon dropped and the exchange rate fell to around 1.3200, then made a further euro strength up to about 1.3300, but after the entry into the European session, the euro fell sharply against the dollar to 1.3200 but the bottom again, and refresh lowest since more than two months, the dollar index rose to more than two months maximum.
Less than expected euro-zone economic sentiment index is considered to increase the euro's decline, but the euro is still the main driver of the debt in the euro-zone countries suspicions. It appears that despite the debt crisis of the EU in order to prevent the spread to more countries unanimously adopted the Irish aid program, but the achievements of the EU, the market did not fully believe it can be achieved, then expand the bitterly contested both long and short .
Pessimistic about the prospects for the euro market is still the main theme of the argument. Analysts pointed out that this is because investors are still worried about the euro zone countries such as Portugal and Spain, the financial risk of default. Even Goldman Sachs warned the euro zone must be carried out a series of fiscal and political action, or else face the disintegration of the euro the next 5 years the risk.
Finish filling the "hole"
Financial
risk exposure in Ireland after the debt crisis in Europe as the market worried about the ultimate is the "bottomless pit" and may be overwhelmed by the EU, the euro weakness over the past few weeks. Last week the dollar index rose 2.43%, higher for the third consecutive week, the euro last week, a decline of 3.15% Zeyi led by non-US currencies. In addition to other than the euro, Australian dollar commodity currencies have obvious decline in risk aversion due to the prevalence and impact of the expected tightening in China.
Bearish on the euro market, not only because such as Greece, Ireland, and receiving assistance after a series of stringent whether the terms of repayment schedule, it is revealed if more debt problems of countries, the EU can become a long "golden master . " Investors have shifted the target from Ireland, Portugal and Spain, and yesterday's index of institutional Markit data show that, despite the assistance of Ireland, Portugal and Spain the two 5-year credit default swaps (CDS) prices still continue to rise.
Most euro-zone countries and the European Central Bank is urging Portugal to the European rescue funds for financial assistance. But more dangerous is that Spain, as the country's economic output is almost Greece, Ireland and Portugal, twice the sum of the total economy, which means that once the Spanish to seek assistance, the euro area is likely to run out of 750 billion euros of financial assistance funds.
Last week, German Bundesbank President Axel Weber has said may be expanding the European Union and IMF had set the scale of relief mechanism, but the German Finance Minister Schäuble said yesterday, there is no reason to expand the scale of relief mechanism, he believes the Portuguese market The speculation is unfounded. German and French finance ministers are on the Portuguese financial "fitness program" very confident.
Doubts still, the euro fell further
Ireland finally concluded the rescue, but all is not settled, the euro's market performance is erratic. On Monday, the euro jumped against the dollar after the opening bell, but soon dropped and the exchange rate fell to around 1.3200, then made a further euro strength up to about 1.3300, but after the entry into the European session, the euro fell sharply against the dollar to 1.3200 but the bottom again, and refresh lowest since more than two months, the dollar index rose to more than two months maximum.
Less than expected euro-zone economic sentiment index is considered to increase the euro's decline, but the euro is still the main driver of the debt in the euro-zone countries suspicions. It appears that despite the debt crisis of the EU in order to prevent the spread to more countries unanimously adopted the Irish aid program, but the achievements of the EU, the market did not fully believe it can be achieved, then expand the bitterly contested both long and short .
Pessimistic about the prospects for the euro market is still the main theme of the argument. Analysts pointed out that this is because investors are still worried about the euro zone countries such as Portugal and Spain, the financial risk of default. Even Goldman Sachs warned the euro zone must be carried out a series of fiscal and political action, or else face the disintegration of the euro the next 5 years the risk.
Finish filling the "hole"
Financial
Bearish on the euro market, not only because such as Greece, Ireland, and receiving assistance after a series of stringent whether the terms of repayment schedule, it is revealed if more debt problems of countries, the EU can become a long "golden master . " Investors have shifted the target from Ireland, Portugal and Spain, and yesterday's index of institutional Markit data show that, despite the assistance of Ireland, Portugal and Spain the two 5-year credit default swaps (CDS) prices still continue to rise.
Most euro-zone countries and the European Central Bank is urging Portugal to the European rescue funds for financial assistance. But more dangerous is that Spain, as the country's economic output is almost Greece, Ireland and Portugal, twice the sum of the total economy, which means that once the Spanish to seek assistance, the euro area is likely to run out of 750 billion euros of financial assistance funds.
Last week, German Bundesbank President Axel Weber has said may be expanding the European Union and IMF had set the scale of relief mechanism, but the German Finance Minister Schäuble said yesterday, there is no reason to expand the scale of relief mechanism, he believes the Portuguese market The speculation is unfounded. German and French finance ministers are on the Portuguese financial "fitness program" very confident.
