With all that’s going on right now, it seems as though euro should be heading lower. However, the 19-nation currency is mostly higher today, gaining against many of its counterparts. Euro is down against the US dollar, but seeing success against other currencies.
There is a lot happening right now in the eurozone, but that isn’t stopping investors today. Investors are buying eurozone debt in spite of political risk and banking crisis concerns. On top of that, the euro is heading higher against many of its currency counterparts.
Another wrinkle is that there are calls for major reform of the eurozone. Economist Joseph Stiglitz says that the eurozone needs to build better institutions, and that the region needs to function more as a united states situation in order for the euro to survive. He has also talked of a “split euro” that is more flexible.
With this talk of euro difficulties, it might seem as though the 19-nation currency should be faltering today, but it is strengthening and there is demand for euro assets. Weakness is expected in the future, but for now euro seems to be on the upswing.
At 14:29 GMT EUR/USD is down to 1.1271 from the open at 1.1279. EUR/GBP is up to 0.8658 from the open at 0.8644. EUR/JPY is up to 113.96 from the open at 113.12.
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