By: Barbara Zigah
The 24-hour rollercoaster ride that the common currency Euro has been on has finally ended as investors cover their short positions. In Asian trading, the Euro slipped 0.5% against the U.S. Dollar to trade at $1.4134, rebounding from the $1.4073 3-week low struck earlier. Against the Swiss Franc, the Euro rebounded off a record low of 1.1946 Swiss Francs to stand at 1.2039 at 12:58 p.m. (JST).
The U.S. Dollar Index also slipped as the market’s volatility subsided, trading at 75.598 .DXY, off the 3-week peak of 76.015 .DXY. Some analysts expect that the U.S. Dollar may see some short-term corrections over the next trading day as policymakers in the European Union address the impending Greek crisis.
Markets have been jittery over the impasse regarding the possibility of a second Greek bailout, with most of the delay a result of ongoing differences as to how private bondholders would share the burden. Germany is pushing for a “harder” option with investors swapping out their current Greek bonds for ones which bear longer maturities. France, the ECB and the European Commission favor a “softer” option that allows current bonds to mature, with the bondholders “promising” that they will buy new Greek debt at maturity of the existing bonds.