Concerns for European Debt Undermines Euro’s Strength

The euro jumped today on the speculation that the rescue package would help Ireland to deal with its debt crisis, but after the sharp advance the currency experienced even stronger drop and currently continues to decline.

Brian Lenihan, Ireland’s Finance Minister, said on the press conference yesterday that the loan would be less than €100 billion ($137 billion), but refused to provide more details. Brian Cowen, Prime Minister, said yesterday that the agreement on the bailout may be achieved in a few weeks. The initial optimism for the bailout was undermined by the concerns about other indebted nations of the European Union, such as Portugal.

EUR/USD traded near 1.3716 as of 11:48 GMT today after it opened at 1.3736 and jumped to the intraday high of 1.3785. EUR/JPY traded at about 114.52 after opening at 114.64 and reaching the intraday high of 114.94.

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