Angela Merkel’s Comments Help Euro

Euro is heading higher today, getting a little help from general risk appetite, as well as from the latest comments made by German Chancellor Angela Merkel about possibilities for Greece going forward.

Euro is getting a boost today, gaining as risk appetite shows up on the Forex market. There is a bit of optimism in the markets, with expectations that eventually US politicians will compromise to avoid the looming fiscal cliff, and expectations that the eurozone leaders will do what is necessary to keep the 17-nation currency viable.
Further evidence for the support of the euro was provided when German Chancellor Angela Merkel made comments about Greece earlier. As Greece outlined its plan for a bond buy back (only paying a maximum percentage of the face value), Merkel said that a further write down might be acceptable under certain circumstances.
With the evidence pointing to the idea that eurozone leaders will continue to allow write downs for debt ridden countries, the euro is heading a little bit higher, since it seems fairly clear that the currency won’t be allowed to fail anytime soon.
At 14:11 GMT EUR/USD is heading higher, moving up to 1.3054 from the open at 1.2984. EUR/GBP is also higher, up to 0.8115 from the open at 0.8105. EUR/JPY is gaining as well, moving up to 107.4215 from the open at 106.9550.

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