Euro Struggles to Regain Ground After Credit Rating Downgrade

The European Union experienced a downgrade in its credit rating earlier today. Along with that news, and following on the heels of expectations for a stronger dollar on Fed tapering, it’s little surprise that the euro has been struggling. However, after some earlier losses, the euro has managed to gain some ground.

Euro is regaining ground lost earlier as a result of disappointing news. The European Union‘s overall credit rating has been downgraded to AA+ from AAA by S&P. The company cites the budget tensions throughout the eurozone, and concerns about what’s next with some countries. The downgrade resulted in eurozone government bonds dipping, as well as a drop in German bunds.
However, the drop by the euro against its major counterparts hasn’t remained steady. Instead, the euro is struggling to regain some of its lost ground, and is now slightly higher against most of the other major currencies.
Questions about the eurozone remain, however. There is still a banking union to implement, and plenty of questions about the sustainability of the economic recovery in the 17-nation currency region.
At 14:46 GMT EUR/USD is up to 1.3661 from the open at 1.3656. EUR/GBP is up to 0.8357 from the open at 0.8342. EUR/JPY is up to 142.6770 from the open at 142.3230.

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