Confidence in the euro is growing right now, as evidenced by the increased issuance of euro-denominated debt. With the news that the eurozone has returned to growth after 18 months of recession, and with the debt crisis seemingly under control, confidence in the euro is growing, and the 17-nation currency is getting a little help.
Thanks to the recent troubles in the eurozone, borrowing costs have been somewhat low. However, nervousness about the fate of the euro has held some back. Now that the eurozone’s recession is officially over, though, companies located outside of the 17-nation eurozone are issuing bonds denominated in euros. The uptick in euro-denominated debt represents an interest not seen for four years.
The increase in companies issuing euro-denominated bonds is rising now that the end to the recession has put a little more confidence into the markets. Many companies want to get in on it while euro borrowing costs are relatively low. The demand for euro assets is helping support the 17-nation currency today. Even though the euro is still down against the US dollar, it is gaining ground against the yen and the pound.
At 14:36 GMT EUR/USD is down to 1.3340 from the open at 1.3346. EUR/GBP is up to 0.8538 from the open at 0.8533. EUR/JPY is up to 130.2355 from the open at 129.9645.
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