Posted December 06, 2011
During the week's trading sessions, all eyes focused on improving news out of the European Union. Information indicates that there is some confidence in the markets in the wake of the financial crisis. However, investors are still leery and continue to wait and see before taking big or long term risks in the market. New European meetings next week could have big implications for investors.
The Monday currency trading session began the week with the euro gaining as renewed hope in the European financial sector grew. The dollar, as a result, moves lower as investors take on more of the risk than in previous weeks. More so, Fitch Ratings came into the picture during the later day's trading and lowered its outlook on the US economy. That did not stop the euro from performing, though. The euro moved from US $1.3224 at the end of the Friday trading session in New York to US $1.3307 for the day on Monday. The US dollar index moved the currency from 79.688 at the close of business on Friday to 79.236 by the close on Monday. The US dollar moved to buy Y 77.405 on Friday but by the end of the Monday session moved to Y 77.99.
The Tuesday session saw the euro fall back, after rising earlier in the trading day. This came as the European Union again took center stage as if was not able to offset the bond purchased made. This allowed the US dollar to remain soft. Investors were too busy worried about the European debt throughout the session. The euro moved to trade at US $1.3329 for the day, though it managed to move as high as US $1.34 during the day. The US dollar index moved to trade at 78.990 for the day. The US dollar bought Y 77.85 by the end of the session.
The US dollar fell significantly during the Wednesday currency trading session against most currencies. It did manage to pare some of the losses later in the trading session. This happened as many of the world's largest banks moved to make cuts in borrowing costs for other banks. This pushed the euro to trade at US $1.3446 for the day. It managed to reach as high as US $1.3532 during the trading session. That is the highest it has touched in the last two weeks. The US dollar index closed the day in North America at 78.345, a drop. The US dollar bought Y 77.53 by the end of the session.
Another day of the US dollar down occurred during the early portion of the trading day but it did manage to come back some. It lost ground as the United States stocks managed to retreat during the day. More so, the European bond yields fell as the auctions in both France and Spain were well received by investors. This pushed the US dollar index to 78.293 for the day. The euro moved to trade at US $1.3467, though it managed to again top US $1.35 during the day's session. The US dollar bought Y 77.72 by the end of the day.
Worry was on the minds of investors during the Friday session. The US dollar improved as investors sought safer ground during the day's trading. There are important meetings scheduled for the next week throughout Europe that could prompt significant changes in the market. This encouraged investors to move to unwind big positions. The US dollar index ended the week at 78.609. The euro moved to US $1.3409. The US dollar bought Y 78.03.