Posted January 10, 2012
During the trading session for the week, though trading remained light due to the holidays, investors took to the euro at the start of the week. Investors seemed anxious to purchase the euro in an effort to make a profit, but poor economic conditions pulled the euro back and the perceived safety of the US dollar pushed it higher. As a result of US economic data and the fears in the euro zone over financial debt concerns, the euro remained down for the week and the US dollar higher.
To start the year, the euro took a hit. The trading for the day remained light as much of the world continued to celebrate the holidays. A key manufacturing report indicated that the euro zone region saw a pull back in manufacturing for the month, making it the fifth straight month of such a decline. The euro moved from US $1.2296 at the end of Friday's trading session to US $1.2931 by the end of Monday's session. The US dollar moved to trade at Y 76.90 which is only a slight change from Y 76.99 from Friday's session. For 2011, the US dollar index moved the current up 1.5 percent.
On Tuesday, the US dollar took a hit. As a result of positive economic data, currency traders moved to the risk of the euro to earn a payout. The euro managed to push upwards to above US $1.30 as a result. The improved economic data came from Asia and Europe, as well as the US. The euro managed to move up to US $1.3064 for the day. The dollar index pushed the currency to 79.591 for the day, a drop of about .8 percent. The US dollar moved to buy Y 76.68 by the end of the Tuesday trading session.
As a reverse for the day, the US dollar improves. Investors move away from risk as continued concern about euro zone debt comes to the top again. Spain brought concern to the table as a report indicated that the country may be looking for financial aid. As a result of the renewed concern about debt in the region, the US dollar index moved to 80.119 by the end of the session. The euro fell to US $1.2939 for the day. The US dollar moved to purchase Y 76.73 by the end of the day's trading.
The euro continues to struggle on Thursday. It fell below US $1.28. It has not been that low against the US dollar for the last 16 months. The US dollar index pushed the Us dollar higher to one year highs against its major rivals. This came after concerns about the European bank capital remerged and continued to push investors away from the perceived risk of the euro. The euro moved to buy US $1.2775 for the day. The US dollar index moved to 80.925 for the day. The US dollar purchased Y 77.10 for the day, up for the day's trading.
To end the week, the US dollar hit a one year high after information about payrolls came out. The euro fell back again for the week. The report out of the US indicated that the US economy added more jobs than was expected to occur in the month of December. The euro fell to US $1.2725 for the day, significantly under the psychological level of US 1.30. The US dollar index moved to 81.244 for the day. The US dollar moved to buy 77.01 for the day.