Did Forex traders get too excited about the euro recently? That’s what many are wondering as political concerns halt the recent euro rally and send the 17-nation currency plunging. Political concerns in Spain and Italy, as well as speculation about the upcoming European Central Bank meeting, are weighing on the euro today.
There are thoughts that maybe the euro isn’t quite ready to support its recent gains. Political instability is weighing on the euro today, particularly in Spain and Italy. Mariano Rajoy, in Spain, is facing calls for his resignation as Prime Minister as a corruption scandal brews. Additionally, the idea that Silvio Berlusconi might actually regain a leadership role in Italy is also weighing on the euro today.
For now, there is some speculation that the ECB might cut interest rates on Thursday, even though most analysts expect rates to remain steady. However, until the ECB decision and accompanying policy announcement on Thursday, there will be an element of uncertainty that might weigh on the euro.
It’s going to be an interesting week, and eurozone leaders will need to work hard to convince Forex traders and others that the euro remains viable.
At 15:30 GMT EUR/USD is down to 1.3555 from the open at 1.3650. EUR/GBP is down to 0.8616 from the open at 0.8699. EUR/JPY is down to 126.6530 from the open at 126.6750.
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