ENM: Euro dollar exchange rate benefits as Greek tension eases
The euro dollar exchange rate enjoyed a slight rally, climbing up half a cent following some positive comments concerning Greece.
The EURUSD is 0.022% lower with 1 EUR = 1.3655 USD at 10am in London.
The euro dollar exchange rate has been maintaining a tight range over the past month; this morning sees the dollar making progress in response to yesterday's bounce back by the euro.
"The Euro slumped towards the support at $1.3550 against the Dollar yesterday but the US currency was unable to sustain a break below this level for a second consecutive day. The Euro also benefited from some easing of tensions surrounding the Greek debt position and the single currency pushed to highs above $1.3650 by the close of trading," reports Adam Solomon at business foreign exchange brokers TorFX.
Helping the Euro's corner was former European Commission President Romano Prodi who said the worst of Greece's financial crisis is over and other European nations won't follow in its path.
The comments come after Greece has outlined a string of austerity measures to rein in its deficit.
The euro also rose as output at French factories and utilities advanced 1.6% in January after a revised 0.2% fall in December.
The gains for the single currency may be more as a result of market players using the comments and the data as an excuse to book profits though, with overall sentiment toward the peripheral countries little changed.
Helping the dollar was a survey out yesterday that showed that investors are the most bullish on the Dollar since the collapse of Lehman Brothers Holdings Inc, amid speculation that the U.S economy will expand at a faster pace than in Europe and Japan. A number of analysts are predicting that the Dollar will rise over the next months.
US Federal Reserve policy will be an important focus over the coming week, with the latest FOMC meeting due to be held on March 16th. There have been further comments from Fed officials suggesting unease with the terminology stating that interest rates will be left at record low levels for an extended period.
