Thursday, 15 Apr 2010

Euro-Zone Periphery Hurts EUR; American Unemployment Up

Following the EUR's gains against the USD yesterday, the EUR/USD pair now appears to be heading lower. US Federal Reserve Board Chairman Ben Bernanke gave testimony yesterday in which it was made clear that interest rates in the United States would remain low for the foreseeable future. The immediate impact was a quick sell-off of Dollars by investors. However, trouble among the European periphery has resulted in a level of pressure being placed atop the EUR by mid-day.

Greece expectations for a US bond sale may end up being cancelled since low interest is being displayed for American bonds. Needed to raise capital for the ailing economy, the cancellation of the bond sale has many investors worried about the speed of Greece's recovery.

Additionally, US unemployment claims came out worse than forecast and the Dollar has seen some small downward corrections as a result. Should the momentum shift back in favor of the EUR we could see a price level near 1.3600 being reached later in the evening. The USD/CAD has also fallen below parity and appears poised to continue falling from poor American economic data.