L’euro renforcé mais stable face au dollar après l’accord européen 

The euro stabilized Tuesday at a high level against the dollar, the approval by European leaders of a historic stimulus plan not having particularly surprised the market which was expecting this conclusion.

Around 9:00 a.m. GMT (11:00 a.m. in Paris), the euro lost 0.04% against the greenback, at $ 1.1443.

After days of procrastination, the European bailout was finally approved in the middle of the night.

When the news broke, the euro hit a new high since March after that of the day before, at 1.1470 dollars, before stabilizing at a level close to that of the day before.

“The final deal does not include any positive surprises for the euro,” said Esther Reichelt, analyst for Commerzbank.

“The interesting part for the market, the total amount of 750 billion euros, and the distribution between subsidies (390 billion) and loans had already been announced” Monday, she said.

“It would have been better if the European leaders had agreed on a larger share of subsidies which would have sent a signal of solidarity and a desire for a more important unified budgetary response,” added Lee Hardman, for MUFG.

In addition, according to Ricardo Evangelista, analyst for ActivTrades, “in recent days, the euro has gained ground against other major currencies”, driven precisely by hopes of an agreement.

Part of the money that will flow from the adopted plan will be borrowed by the European Union as a whole.

This joint debt issue, a first, is based on a Franco-German proposal, which aroused fierce opposition from the four so-called “frugal” countries (the Netherlands, Austria, Denmark, Sweden), then joined by Finland.

Source: L’euro renforcé mais stable face au dollar après l’accord européen – Boursorama

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