Banking Deal Expectations Boost Euro

Euro is heading higher right now, even hitting a six-week high against the US dollar at one point, thanks to expectations of a banking deal in the eurozone. Many expect a banking deal to bring greater stability to the euro, and that is helping the situation right now.

Euro is heading higher right now as leaders in the eurozone appear closer to working out a deal that will create a tighter banking union in the 17-nation currency region. This union would allow European Union leaders to shut down eurozone banks that are failing. The agreement is expected by year’s end. Once again, the euro is showing resilience, even in the face of poor economic data. It remains obvious that eurozone leaders are determined to save the euro, and the knowledge that they will do what it takes is helping keep the euro from failure.

The 17-nation currency is especially seeing gains against the US dollar. Earlier in the session, the euro reached a six-week high against the greenback. Expectation that the Federal Reserve will put off starting its taper are once again weighing on the dollar and giving the edge to the euro.

At 15:38 GMT EUR/USD is up to 1.3764 from the open at 1.3740. EUR/GBP is up to 0.8378 from the open at 0.8364. EUR/JPY is up to 141.4730 from the open at 141.9190.

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