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Euro: Demand for Swiss Francs |
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Thursday, 26 May 2011 06:05 |
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EUR: Debt Problems Increasing Demand for Swiss Francs. After a break of one day, investors have returned to sell euros and other currencies are superior. The rally yesterday in the currency market is very suspicious especially considering change of equity prices, demand for the Franc Switzerland and increase in the price of gold.
Tonight, can come a new round of risk aversion which not only raised but make the Franc is at new record highs against the euro. It can be said that the current safe haven dominated the trade because of the strengthening Yen Japan, Switzerland Francs and u.s. dollars.
Plans to privatize Greece is far from resolving the problem of the European debt crisis and concerns about the movement of populist in Spain and Greece have made investors nervous.
Although, plans privatisation Greece increases the likelihood of State receive additional assistance from the EU and the IMF, the suburb still trouble getting domestic support to provide additional funds for Greece. As a result, Greece will remain a problem for the euro mainly speak in the midst of that membership of the euro is at the risk that would make it very difficult for the EUR/USD to stage a serious recovery.
Even comments from ECB President Madox, Draghi failed to provide support to the currency. Draghi Monday confirmed commitment of the central bank to keep inflation expectations and discuss the challenges that could cause inflation to global growth.
He has a lot of the same view as Trichet and will most likely maintain this bias in the beginning of term of Office to secure the credibility.
Just a little bit of the role of the euro zone data apart from Germany that deteriorating consumer confidence in June because consumers grew less optimistic about revenue and business activities.
The price of imports of Germany and Switzerland trade balance is scheduled for release today but the focus for traders on the speech of Trichet euros in Berlin. Everyone should also be watching the Franc Switzerland because of its performance will serve as the measuring sentiment in the euro zone. |