Is this part of the rumored/expected financial woes? Thanks to Lou.
The Euro Just Tanked Hard
https://www.businessinsider.com/the-euro-just-tanked-hard-2010-11
Very strange… the euro has been acting weak lately, thanks perhaps to the renewal of the PIIGS [Portugal, Italy, Ireland, Greece, Spain] crisis, and then just in the last several minutes it collapsed.
Market Review – 04/10/2010 22:20 GMT
Euro tumbles from a 6 1/2-month high on renewed concerns over European debt
https://www.fxstreet.com/technical/market-view/daily-market-outlook/2010-10-05.html
Euro tanked from a 6 1/2-month high against dollar on Monday, as renewed worries about European debt crisis dampened investors’ demand for the single currency.
Despite euro’s rise to a 6 1/2-month high of 1.3809 in New Zealand due to euro-supportive comments from Chinese Premier Wen over the weekend, the single currency fell from there on profit-taking after last week’s strong rally and dropped to 1.3746 in Asian morning. Later, euro fell sharply to 1.3666 in European morning on reports of active sales by Asian name before staging a recovery to 1.3723 and then traded sideways in NY session. Eur/jpy and eur/chf tumbled from 115.29 to 113.74 and from 1.3468 to 1.3290 respectively.
Chinese Premier Wen said on Sunday that ‘China supports a stable euro’ and offered on Saturday to buy an unspecified amount of Greek government bonds when debt-laden Athens resumed issuing.
The single currency was under pressure on concerns over eurozone peripheral debt after the Financial Times reported that Ireland’s budget deficit this year would be higher than earlier forecast plus warning by Nobel Prize-winning economist Joseph Stiglitz who said the euro’s future was ‘looking bleak.’
Euro was also under pressure on Monday as Switzerland told UBS and Credit Swiss to increase their capital level well in excess of the new international rules.
The news from Ireland and Greece weighed on the single currency as Irish central bank warned that Ireland’s economy would grind to a virtual halt this year, adding pressure for further spending cuts. Greece released its forecast that its economy would contract 2.6%, as it dropped 4% in 2010.
Although the greenback rose strongly against the Japanese yen and climbed to an intra-day high of 83.88 in Asian morning on talks of sizeable buying interest from Japanese names, dollar retreated sharply from there due to intra-day active cross-buying of yen and tanked to 83.18 in European morning before recovering in NY session.
In other news, Brian Sack, the head of the New York Fed, said that further asset buying by the Federal Reserve would help spur the economic recovery and a small-step approach would enable the U.S. central bank to be more responsive to evolving conditions.
Earlier, NHK Television reported that Ichiro Ozawa, DPJ’s kingpin, had to be indicted for violating campaign-finance laws, according to a copy of a ruling by a judicial panel. Katsuya Okada, DPJ’s No. 2 official, said at a press conference that news of the panel’s recommendation was ‘surprising and regrettable’ whilst Chief Cabinet Secretary Yoshito Sengoku declined to comment on the ruling.
Despite cable’s brief drop to 1.5775 in New Zealand due to cross selling in sterling, buying interest at there lifted price to 1.5827 in Asian morning. Later, although cable dropped to 1.5749 in European morning, it rebounded on release of better-than-expected UK PMI Construction data and climbed to 1.5870 in NY morning together with active cross buying in sterling versus euro before retreating. Eur/gbp tumbled from 0.8758 to 0.8631.
Sterling was supported by the stronger-than-expected UK PMI for the construction sector, as it came in at 53.8 in September, versus the expectations of 51.4 and 52.1 in August. Despite showing an increase in new orders for the seventh consecutive month, CIPS said rate of increase had fallen 4 months in a row, indicating confidence over future business outlook had dropped markedly lower whilst job cuts were at the fastest pace in 6 months.
In global stock markets, DJI fell by 78.41, or 0.72% to 10751 on profit-taking while Nasdaq tumbled by 1.11%. FTSE-100, CAC-40 and DAX sank by 0.66%, 1.15% and 1.24% respectively.
Economic data to be released on Tuesday include:
Australia Retail sales, Trade balance (aud), RBA rate decision, Japan BOJ rate decision , Swiss CPI , Germany Services PMI , U.K. Services PMI , EU Services PMI, EU Retail sales, U.S. ISM non-manufacturing.