Waiting for Cyprus and the Fed

By GG Analyst in Reviews 0 Comment

EUR/USD

As was widely forecasted by skeptics, including us – the government of Cyprus didn’t come up to the final decision on the bank deposit levy. None of the parliamentarians supported the initial plan: 36 voted against and 19 abstained. And though many believed that the shift of the burden to larger deposits would be treated positively, so far traders have preferred to sell the single currency. Yesterday EURUSD hit a fresh low since last November. The stock markets from time to time stumble over sales – the current bounce off the highs looks quite moderate from the historic point of view. more…

Waiting for real action

By GG Analyst in Reviews 0 Comment

EUR/USD

Yesterday afternoon the market was trying to recover after the morning negative. The major incentive to purchase the euro was given by the news that Cyprus would like to reconsider the levy for investors with smaller deposits (up to €100K). A bit later we learnt that the EU also didn’t have anything against it. The only thing that worries the officials now is not to allow the total amount of money that Cyprus will allocate to keep its own domestic banks afloat go above the estimated 5.8bln. Besides, it is widely believed in the markets that Cyprus cannot be treated as more…

Cyprus bailout

By GG Analyst in Reviews 0 Comment

EUR/USD

The word “bailout” presupposes some aid, easing of the lot of the rescued. Earlier money allocations to the rescued Greece, Ireland, Portugal and Spain led to growth of the single currency, albeit the short-term one sometimes. Yet it is different with Cyprus, “rescued” last Saturday. EURUSD dropped by 1.5% after the EU’s decision to impose a one-off 9.9% levy on accounts with more than €100K. Smaller deposits will be taxed at 6.75%. Altogether, it should bring €5.8bln to the government of Cyprus. The EU will allocate another 10bln. Earlier it was calculated that Cyprus would need about 17bln, but the IMF more…

Spain takes Italy’s investors

By GG Analyst in Reviews 0 Comment

EUR/USD

All that Italy didn’t get went to Spain. Here we speak about the debt auction that was held in these countries on Wednesday and Thursday accordingly. EURUSD reacted accurately to the markets’ message. If on Wednesday it was decline due to the low investor demand, yesterday the single currency was brought back nearly to the same levels: it’s again trading a bit above 1.30. Yet, it’s worth mentioning that weakness of the dollar also contributed to sales of the euro. It arose on the decreased concerns that the high demand of the US households would boost price growth. As we see more…

Double blow to EUR

By GG Analyst in Reviews 0 Comment

EUR/USD

The moderate buying of the single currency on Wednesday morning stumbled over the wave of sales. The growth momentum of the pair was halted at 1.3060. Roughly in the same zone there had been a reversal a day before , but this time the bears were prepared better. By the middle of trading in the USA the pair had fallen to 1.2922. There are two reasons for the bears to be that self-confident. First of all, the auctions were not a success – three of the four bonds of different maturity demonstrated a higher yield. In the meantime the yield of more…