Euro is gaining ground today, thanks to the fact that many Forex traders are treating the 19-nation currency like a safe haven. Euro is trading a lot like the Japanese yen right now, and that is leading to gains as concerns about the global economy, particularly in light of today’s performance in Asian markets, weigh on high beta currencies.
Euro correlation with the yen is getting tighter. Indeed, the correlation is at its highest level since 2007. As concerns about the global economy become more apparent, the euro is gaining some ground. Traders see the euro as a kind of protection from volatility, if only because eurozone leaders have done so much to prevent the euro from collapsing.
There are expectations that the dollar could strengthen later this week, though. There isn’t a whole lot to bolster the euro long-term. Once again, inflation in the eurozone remains relatively low, and the European Central Bank will be hard-pressed to figure out how to continue to support economic growth. Continued weakness for the 19-nation currency is predicted by many analysts.
At 13:10 GMT EUR/USD is up to 1.1231 from the open at 1.1173. EUR/GBP is also higher, moving up to 0.7287 from the open at 0.7250. EUR/JPY is up to 136.1900 from the open at 135.9400.
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