Forex Fundamental Analysis
The gains made two weeks ago were largely reversed when Greece insisted that it would put the EU bailout to a referendum. By the end of the week, the idea was dead in the water and confusion ruled.
With all the drama playing out on the European stage, it is easy to forget that we are “recovering” from a global financial crisis.
While the Non-Farm Payroll announcement is arguably the “granddaddy of all announcements”, this month may actually have very little impact as the world is focused squarely on the G-20 summit.
A week ago, markets across the world were putting on substantial gains and the Euro was strengthening on the news that EU leaders had put together a package.
In what would have been one of the week’s major news items, had it not been for developments in Greece, the Bank of Japan has interceded in the foreign exchange markets to weaken the Yen.
The European market is becoming a bit of a merry-go-round as the Europeans continue to come together with patchwork plans to stem the tide of financial destruction in sovereign debt markets.
Just when you thought that it was safe to go back into the waters of the markets with the EU deal in place to support the banking sector and prop up the finances of any EU state needing a bailout, turmoil has returned.
Last week was a very positive affair for the world’s markets. Eurozone and EU leaders presented a plan which is designed to provide support to banks, provisions for further EU bailouts and an agreed haircut for banks that are Greek bond holders, should the need arise.
The deal thrashed out between the leaders of the EU and the banking sector on Wednesday is still sending shock-waves of euphoria through global markets and is boosting banking shares around the world.
Markets in Europe are up strongly the morning after an EU leaders meeting was held which aimed to put a bottom under the sovereign debt crisis in Europe and shore-up bank finances. But only time will tell if the measures can have the desired effect.
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