Euro is higher today, gaining even though banks are still making high demands on the ECB’s marginal lending facility. A total of 14.8 billion euros were borrowed on Monday night. This wasn’t as much as borrowed last Thursday night, but it indicates that banks are still demanding emergency money from the ECB. Even so, the euro is higher today against most other major currencies.
The surge in lending from the ECB’s facility suggests that many eurozone banks are still having trouble with their balance sheets. It seems somewhat natural to tap the emergency funds at the close of the year, to bolster the look of matters. However, if demand on the facility remains high in the new year, additional fears of a banking crisis in the eurozone could prompt a level of panic in the markets.
Right now, though, there isn’t a great deal of worry about the situation. The euro is higher as Forex traders and investors show a tendency for optimism today. European equities are higher, and US stock futures are pointing to a higher open. This enthusiasm in the new year is supporting the euro against its counterparts, although concerns about the situation in the eurozone are limiting some of the gains.
At 13:55 GMT EUR/USD is higher at 1.3029, up from the open at 1.2937. EUR/GBP is up slightly to 0.8362, from the open at 0.8337. EUR/JPY is higher at 100.0415, up from the open at 99.4550.
If you have any questions, comments or opinions regarding the Euro,
feel free to post them using the commentary form below.
Be First to Comment