Bank capitalization concerns are the main focus today, especially after the debacle involving UniCredit. Worries about bank capitalization, and a continuation of the sovereign debt crisis in many eurozone states, has the euro heading lower again today.
Even better news out of the United States, with the news that the December unemployment rate dropped to 8.5% can’t boost risk appetite. There’s just too much focus on the eurozone, and the debt problems in the region. With concerns about bank capitalization, the recent (unfortunate) French bond auction and more, it is tough for the euro to get any sort of a break, and the 17-nation currency is threatening to break lower, through the 1.2700 level.
Angela Merkel and Nicolas Sarkozy are scheduled to meet next week to discuss the sovereign debt crisis, and looming bank crisis, and try to come up with a way to defuse the situation. However, dozens of similar meeting have taken place over the last couple years, since Greek problems first became apparent, and nothing substantial has come of them. It is little surprise that the euro can’t seem to find any traction right now.
At 15:34 GMT EUR/USD is down to 1.2714 from the open at 1.2788. EUR/JPY is lower at 77.0970, down from the open at 77.1160. EUR/GBP is a little higher, though, at 0.8259, up from the open at 0.8253.
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