$ 8 billion bet on the decline of the euro

Nearly eight billion dollars. Or nearly 6 billion euros. In one week, traders and hedge-funds (hedge funds seeking higher returns, in particular through the options) were initiated some 40,000 contracts against the euro, according to the online edition of the Financial Times on Monday evening. Investors have decided to take so-called short positions on the euro, that is to say, bet down on the currency. In total, these investments "shorts" are a massive $ 7.6 billion, according to the website of the newspaper, stating that this is the first time such a sum is committed to bet on falling the single European currency.

The reason for this change of strategy: the loss of confidence in the euro, which no longer seems able to resist the contagion of the Greek debt on other European countries.Greece is central to the nervousness of financial markets, both on the Old Continent as the other major stock exchanges worldwide. And worries extend to serious budget situations Spanish and Portuguese.

Yesterday, Monday, Elena Salgado, Minister of Finance of Spain, and Jos? Manuel Campa, his deputy, flew to London to allay fears: They reiterated their goal of reducing by 3% budget deficit by 2013. It reached 11.4% of GDP in 2009.

The euro has won almost 10% in two months

On Tuesday, around 8:30 am, the euro regained some color since last night, going above 1.37 euros at 1.3728 dollar guaranteed approval cash loans . On Monday, the European single currency remained broadly under that threshold.There is still a week against the euro was trading more than 1.4 dollar.

The d?grindolage actually started last December. The euro was trading at nearly even $ 1.51. It is almost 10% more than two months later. Just this last month of 2009, the euro has won nearly 5%, losing 30 days that the currency had taken three months to win.

By touching a low at 1.3585 euros February 5, the euro has regained its level in May 2009 …. and August 2007.

For some analysts, the slide is not over, and the euro could well return to the threshold of 1.25 dollars, amid U.S. growth stronger than expected.

The political spotlight

Tomorrow, Wednesday, Ben Bernake, will explain why the strategy for ending the crisis that has put in place.Any speech that would imply a monetary tightening will cause the wrath of the financial markets.

Then, next Thursday, it was the turn of Europe to be in the limelight, with the meeting of heads of state of the eurozone.

ALSO READ:

"Decline in Euro: winners, losers

The five ways to save Greece

"The crisis in Europe will play" collective "

"Public deficits alarm Fellowships

Posted by admin

No Comments Yet - You can be the first to comment!

Sorry, comments for this entry are closed at this time.