Euro Continues To Teeter Against the Swiss Franc
The single currency continues to remain lower against the Swiss franc in mid-afternoon trading in New York. With currency traders out for the European holiday, the exchange rate is expected to remain near the 1.2000 SNB benchmark – currently trading at 1.2013.
For the most part what has led the Euro lower against the franc has been growing concern that further damage to the European Union is likely in the second quarter, with others still noting that European leaders are too slow to react to the still brewing fiscal calamity. The sentiment has helped to propel Spanish bond yields higher – to above 5% at 5.75% currently. Italian 10-year benchmarks have risen to 5.45%. Although far below their records above 7%, there is rising speculation that bond yields in these two troubled economies is likely to reach these levels once again – with the recent decline only being in response to the recent LTRO offerings at the end of last year and the beginning of this year.
As a result, traders will look to tomorrow’s opening in gauging any further and potential declines in the single currency – with specific emphasis on where the 10-year benchmarks end up.
Against the US dollar, prospects are a bit brighter. Technical buying opportunities are likely to support a jump up in the pair in the short term – with traders emphasizing the 1.3050 figure. As noted in a previous release, the level is an major support figure that could lend to further momentum higher – even with the single currency trading at 1.3111 currently.
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