Foreign exchange market yesterday haze. In addition to the euro area countries, investors remain worried about the debt crisis, the sudden spread of the Korean firing of the news market, the tension increased, the euro and other non US currencies against the U.S. dollar lower.
Weighed on the euro
On Tuesday, Japan s closed due to holidays, foreign exchange trading market in Asia is more light periods, but the Asian market late breaking news coming from the original Korean fighting the peace, war risks the news of emotional frustration and triggered investors safe haven buying against the dollar, so the euro, Australian dollar and other non US currency pressure down.
The announcement yesterday after about two Koreas, the euro from 1.3600 against the dollar quickly fell to about 1.3540, the euro s decline has also affected other non US currencies lower, such as the Australian dollar is also obvious point drop in the dozens, in addition to the yen the won and other Asian currencies are also investors sold the U.S. dollar index rose homeopathy hit 79, but then fell back.
After entry into the European session, the euro failed to regain the losses late in Asian cities, all the discussion about the debt crisis continues to adversely on the euro. Although the European market released in France, Germany and the euro zone PMI data in November was better than expected, the euro and other non US currencies has not been significantly boosted, analysts believe that financial problems in the euro zone countries are still investors in the hearts of the shadow play does not go, when tensions between Korean exacerbated the market panic, which is unfavorable performance of non US currencies.
Ireland is still the focus of the debt crisis
Risk appetite is also due to the Irish downturn seek help, the investors in Ireland and other countries, concerns and bearish sentiment on the euro can not be successfully completed.
Yesterday, the euro zone and the debt situation in the Korean Peninsula weighed on the euro, the dollar is maintained at high and volatile. Ireland on Sunday, news of the official for help only a limited boost to the euro, investors rationally assistance Irish news that seeking help means that the debt burden in Ireland and Portugal, Spain and the EU will probably IMF ask for money.
Although the EU has committed to provide assistance payment for the Irish, but on a heavily indebted country may not necessarily be a good thing. ECB officials have said the Irish Aid Scheme strict conditions attached, another rating agency Moody s also said that the increased burden on the Irish to obtain relief means, which is detrimental to Ireland s sovereign rating.
Disadvantage lies in the Irish Council will be faced with turmoil. Ireland 7 December 2011 will vote on the Budget, the Irish Green Party said on Monday, will be determined in the Budget out of the coalition, and intends to dissolve parliament in January next year, early elections, which means that the Prime Minister Brian Cowen s government is about to collapse. Ireland was originally scheduled for the next election held in 2012.
States want to pull through the crisis, the crisis countries themselves only by improving fundamentals for the job but the Irish economic and political risk is clearly on the resume for the solvency of their disadvantage. In addition to Ireland s own issues, investors also worried Portugal, Spain s financial situation. While the top leaders of both countries have said they do not need any assistance, but still can not Jiaoren trust, after all, just the previous week, the Irish government insists on its own solve the problem.
It appears that although the Irish will get relief, investors still do not intend to immediately abandon the concern of the debt crisis, the European market after the opening bell yesterday, Portugal, Spain and Germany to expand the national debt is still showing the trend spreads.
Out of Ireland and the future repayment of the debt problems of proliferation concerns about the possibility of consideration, the euro can not reverse the downturn, the crisis in the Greek market has been fully discussed, the fundamental reason for investors to short the euro is the absence of the euro zone system, which common monetary policy, but the lack of financial coordination, economically backward countries only use fiscal measures to stimulate the economy and ultimately lead to debt.
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