Investing.com - Financial Markets Worldwide

Euro Hovers Near Record Low Against Aussie And Loonie

ByActionForex
Published 07/22/2012, 07:38 AM
Updated 03/09/2019, 08:30 AM
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While the risk rally is losing some steam ahead of the weekend, the Aussie and Canadian dollars continue to be broadly firm. In particular, notable strength was seen against the euro and EUR/AUD and EUR/CAD continue to hover around the record lows made Thursday. Spain's 10-year yield continue to hover around 7% level and would continue to weigh on the common currency. The dollar and yen are mixed so far as risk appetite pressured both currencies against high beta ones. But both are still stuck in range against European majors.

German Bundestag voted in favor of the Spanish bank bailout plan yesterday after Finance Minister Schauble warned that "problems in the Spanish banking sector have become a danger for the European economy." Germany's EUR 29b contribution to the EUR 100b bailout program for Spain's troubled banks was now approved . But the bigger problem in Germany is that the Constitutional Court has yet to approve the permanent bailout fund, the ESM and will need to wait at least until September 12 before a decision. Separately, Spain's Parliament approved the EUR 65b austerity package.

On the data front, Australia's import price index rose 2.4% qoq in Q1 versus expectation of 1.5% qoq. German PPI dropped more than expected by -0.4% mom in June versus consensus of -0.2% mom. Year-over-year, PPI moderated sharply to 1.6%, comparing with May 2.1%. UK public sector new borrowing is expected to drop to GBP 11.2b in June. From Canada, headline CPI is expected to climb back to 1.8% yoy while core CPI is expected to rose to 2.3% yoy in June. The inflation data would support BoC for not abandoning its tightening bias.

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