EUR/USD

Euro Up and Dollar Slides As U.S. Credit Rating Is Safe For No

The Euro is up today with the EUR/USD pair sitting at 1.3516 right now, a change of 0.0026 as investors don’t have to worry about any credit rating downgrades on U.S. debt right now. The dollar was also weaker against the Canadian dollar (USD/CAD) and Swiss Franc (USD/CHF).

After the failure of the super committee on getting any sort of debt reduction plan in place, many investors began to wonder what that would mean for the U.S. credit rating. Well today, many agencies including Fitch Ratings, Moody’s and Standard and Poor’s left their rating unchanged.

Moody’s did warn on Monday however that French debt could lose its AAA rating because of the increase in borrowing costs and slow growth. Kathy Lien of GFT Forex said, “A downgrade of France would cause far more carnage on the market than a downgrade of Spain or Italy even though it would all be extremely bad on the market.”

In Spain, Standard & Poor’s said the country’s credit rating will remain unaffected by the results of their elections over the weekend. The opposition center-right Popular Party won an absolute majority.

The Indian rupee hit a 2-year low against the dollar yesterday when it fell to 52.21. The Reserve Bank of India has been raising interest rates since early last year. The rupee fell yesterday after the steep sell off that hit global markets and investors running back to the safety of the dollar. Forex trading will continue to be volatile on this holiday shortened week and as the euro zone debt crisis continues.

Forex Trading Roundup: EUR/USD Up, USD/JPY Down

In today’s forex trading roundup, the EUR/USD pair traded in the euro’s favor while the dollar slid against the Yen. The Euro rose today as traders speculated that the IMF would help with Europe’s debt crisis. Rumor has it, the ECB will loan money to the IMF to help bail out debt-ridden nations. Germany has expressly denied this rumor, but that hasn’t stopped it from gaining traction. The EUR/USD pair is currently trading at $1.3521, an increase of $0.0056.

The USD/JPY pair fell to 76.7935 Yen per $1 dollar. The dollar showed weakness across the board in the forex markets today after the New York Fed President, William Dudley, said they will do ‘everything’ they can to stimulate the economy. He also said the economy faces ‘significant downside risk.’

Here’s what traders should keep an eye on next week. As always Europe will take center stage as traders hope for good news on the handling of the debt crisis. In particular, PMI indices for November will be something to look too as an indication of how the overall EU economy is doing. The elections in Spain this weekend will also be something to watch. And finally, the upcoming deadline for the ‘supercommittee’ to get something done could add a lot of uncertainty in the markets should they not decide on how to deal with the U.S. debt.

Real Time Web Analytics