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Euro dollar exchange rates: the latest

10.03.10

By Sam Coventry
 
The euro dollar exchange rate is currently tilted in favour of the US component. Two foreign currency brokers give their verdict. The EURUSD is 0.103% lower at 10am in London. 1 EUR = 1.3583 USD. Caxton Fx point out that yesterday the euro has reversed recent gains, heading back to 1.36 against the US dollar as a rise in risk aversion saw the single currency sold. Today it appears to be much of the same. The ratings agencies were back in the news yesterday, focusing their attention on both the UK and the peripheral eurozone nations. Fitch said that it still has a negative outlook on Portugal's double A rating and was studying he details of the country's new austerity measures. Despite strict measures taken in the debt-laden countries, and some encouraging comments from the EU, the markets remain concerned about the fiscal situation in the eurozone, which is holding the single currency near its ten month lows.

The US dollar, and indeed the safe haven Japanese yen, is maintaining its
upward course this morning, with little encouraging news to support riskier assets. Adam Solomon at business foreign currency brokers TORfx also focuses on the 1.36 level. "The Euro failed to make any headway against the Dollar yesterday and there was a renewed test of support close to the $1.36 level. The single currency endured further selling pressure during the European session with a low close to 1.3535, amid a fundamental lack of confidence in the Euro-zone economy," says Solomon. There are concerns that the tensions engulfing Greece
will spread to Portugal and Spain, bringing the economic recovery in the region to a grinding halt. Fitch Ratings Agency expressed caution over the medium-term outlook for Greece, while there was also evidence of increased tensions within the Greek government on plans for budget cuts. The latest US consumer confidence index was generally weaker-than-expected and the overall mood of risk aversion continued to support the Dollar. There are no major US data releases until Thursday and the U.S currency has been unable to draw support on yield
grounds. However, there will still be expectations that the US will out-perform the Euro-zone over the coming months, which will tend to underpin Dollar sentiment.

 
http://www.economy-news.co.uk/euro-dollar-exchange-rate.html