Euro Steady Below $1.29

The euro traded steadily below $1.29 on Tuesday morning as investors took comfort in successful bond auctions throughout the eurozone and positive reassurance about Italy's new coalition government. The common currency traded at $1.2886 at 6:37 GMT on Tuesday.

Despite the region's longest recession since the currency was born in 1999, lower financial costs have helped regional governments get ahead in their funding programs. According to Financial Times, the European Central Bank's efforts to keep the region together have created great conditions in which nations can sell their sovereign debt.

By selling their debt in an environment of strong investor demand and low borrowing costs, France, Italy, Belgium and the Netherlands have all raised more than 50 percent of their yearly targets. However, the region's unemployment figures and GDP still paint to a disappointing economic picture which suggests a disconnect between the public sector bonds and funding for the private sector.

In Italy, the new coalition government has been struggling with deep divisions between some of its members. After ministers from Silvio Berlusconi's People of Freedom Party attended a rally earlier this month, the coalition was forced to face its short comings and address the fractured relationships.

Now, weeks later, Mario Moni, Italy's former prime minister and current member of the Italian Senate told reporters he was confident that the coalition would hold.

CNBC reported that Monti spoke of the country's new Prime Minister, Enrico Letta, in a positive light at a press conference in Singapore. He said Letta's strength would keep the new government from crumbling. Monti also pointed out that a new electoral law needs to be completed after the last election's inconclusive results left Italy without a government.

Without a new system in place, he said, the government is unlikely to break up and hold new elections.

BY Laura Brodbeck