Euro is currently in consolidation mode against the US dollar, looking to firm up a bit against the greenback. However, the 17-nation currency is struggling a bit on uncertainty, and awaiting the latest remarks from Fed Chair Ben Bernanke.
Euro has been swinging between small gains and small losses during the session today, trying to consolidate, and trying to find direction. The latest election results out of Italy are complicating matters a great deal. No group has won a governing majority, but the results at the polls are a definite revolt by Italian citizens against austerity.
Italian bond yields shot up by 44 basis points following the results, before settling back a little bit. The news doesn’t bode well for the eurozone’s periphery, and that means weighing difficulties that might arise as a result of the situation.
Euro is also waiting on testimony from Ben Bernanke. The Federal Reserve Chair is expected to speak about the economy, although he is also likely to avoid the topic of quantitative easing. Forex traders and others will be waiting to see what he says. An end to the QE efforts in the United States could mean a stronger dollar, but a continuation means weakness down the road.
At 15:38 GMT EUR/USD is down to 1.3052 from the open at 1.3062. EUR/GBP is up to 0.8621 from the open at 0.8615. EUR/JPY is down to 119.7045 from the open at 119.9450.
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