Markets are Getting Ready to Difficult 2012

By GG Analyst in Reviews 0 Comment

EUR/USD

Yesterday the single currency continued its decline on the increasing bids that the ECB would keep tempering their monetary policy. So, market participants have focused on the amount of the ECB’s reserves. The latter have already made 2.73 trln euros. But the right way to compare the ECB’s reserves with those of other CBs is to consider them in relation to GDP. And at this point they make impressive 29% against approximately 20% of the Federal Reserve and the Bank of England. It’s worth mentioning that the ECB’s balance has doubled over the past six months and is very likely to more…

ECB’s Support of Debt Markets Triggers the Euro Selloff

By GG Analyst in Reviews 0 Comment

EUR/USD

The single currency got a back-blow in yesterday’s U.S. session. Its movement from 1.3070 to 1.29 just in a couple of hours was mainly connected with the fact that the yield of the two-year German securities fell below the U.S. yields of the kind. Yesterday the German two-year bond yield made 0.17% against 0.24% a week earlier. The American bond yields haven’t decreased much over the week, going down from 0.28% to 0.27%. In general, this means that the market is expecting further rate cuts by the ECB. Theoretically, it is reasonable, but the situation has formed not in one day more…

European Banks Borrow from ECB to Deposit to ECB

By GG Analyst in Reviews 0 Comment

EUR/USD

Last week the demand for three-year loans issued by the ECB at a fixed rate was twice as high as expected and amounted to 489 billion euros. And here is another piece of news: banks’ deposits to the ECB set a record making 412 billion euros. Banks behave like bargain hunters in a sale. They‘re grabbing everything that is cheap without thinking whether they really need all this stuff. In addition, the increase in the ECB deposit facility reflects the deplorable state of affairs in the sphere of interbank lending. It is not very good. Banks are waiting to see what more…

Europe’s Vigour Fades, America Takes the Reins

By GG Analyst in Reviews 0 Comment

EUR/USD

The single currency fell below 1.30 yesterday and didn’t manage to recover in the course of the day. Some treat such a sudden sale of the euro as a consequence of investors’ disappointment in Merkel’s decision not to expand the size of the EFSF. Others also see the reason in the fact that agreements which were negotiated and signed by the heads of European states during the EU summit are still to be approved by the governments. And this issue is not that simple. But there is one more factor – the fall of liquidity at the end of the year. more…

That’s all, Folks!

By GG Analyst in Reviews 0 Comment

EUR/USD

On Monday the euro fell below 1.32 due to the investors’ disappointment in the EU summit. Problems haven’t been solved; all we have now are just pledges to consider a closer fiscal union in half a year – an eternity for a debt crisis! EURUSD is now at 1.3170. It was at 1.3370 at the beginning of Monday’s trading. Moreover, the received comments have once again proved that Germany is not very willing to accept current terms. The fact is that Bundesbank can issue a loan to the IMF only when given the consent of legislators. As follows from the previous more…