Euro Spends Week Shaken Up

Posted May 25, 2011

Greek debt weighs heavy. Investors consider risk carefully.




During the currency trading session on Monday, the US dollar fell against the euro zone currency. As it did, it pushed the euro to the highest level it has been at since late April. Investors worried that the IMF chief's arrest would hurt decisions about the outcome of the Greece assistance for its debt concerns. The euro moved from US $1.4111 as of the end of trading on Friday to US $1.4189 by the end of the Monday session in North American trading. The US dollar index positioned the US dollar at 75.484, which is a change from the 75.761 the currency was at on Friday. The Japanese yen moved from Y 80.82 on Friday to Y 80.76 by the end of the trading day Monday. The UK pound moved from US $1.6186 on Friday to US $1.6214 for the day.


During the Tuesday trading session, the US dollar fell lower, moving down against the euro as well as the UK pound. This came as the US stocks and commodities markets came off the lows for the day. Still, weak economic data out of the US hurt the markets. The US dollar index moved the currency to 75.441 which was down from Monday significantly.  During the trading day, the US dollar index did climb as high as 75.834 for the day, which is the highest it has been at recently. The euro moved to US $1.4219 for the day while the dollar moved to Y 81.42 as well.


The Wednesday session saw that US dollar paring its losses against other major currencies. This came mostly after the Federal Open Market Committee meeting's minutes were released, which showed that most officials in the organization were split on whether or not the tightening of monetary policy was a good thing. Some believe doing so could hold back any economic growth occurring, while others wanted to hold back inflation by moving to tighten up monetary policies. During the day, the US dollar index moved the current to 75.438 by the end of the session. The euro moved to US $1.4233 for the day, though it fell as low as US $1.4193 during the session. The UK pound moved to trade at US $1.6149 by the end of the session.


On Thursday, the currency markets showed the US dollar falling against most other major currencies. This came in after several reports out the US show trouble. Both the reports from the housing market and the manufacturing industry did not convey good information investors were hoping for.  A jobless claims report showed improvement, however. The US dollar index moved the currency to 75.106 for the day as a result. Against the euro, the dollar moved to US $1.4308 for the day, which was up from US $1.4205 which it was at just before the data release. The US dollar moved to Y 81.61 as well.


The Friday trading session showed the US dollar continuing to improve against the euro. This occurred as Fritch Ratings moved to reduce Greece's credit rating and warned the country that any attempt it made to extend maturities of any sovereign debt the country holds would be a default. This moved the euro to US $1.4136 for the day, a fall of more than one percent. The US dollar index moved to 75.441 for the day. The UK pound moved to US $1.6248 for the day as well.  The euro fell by 1.1 percent against the UK pound during the trading session and also fell by 1 percent against the yen.