Economic Commentary
- We turned a page of the Cypriot saga yesterday as the island nation's parliament voted massively against the aid measures proposed by the European Union over the weekend. According to certain media sources, Cypriot representatives have begun talks with Russia, which is responsible for some 30% of the deposits at the island's banks, with a view to implementing made- in-Moscow assistance measures. The euro dropped to its lowest level since December against the greenback yesterday. It truly is impressive how much turmoil can be created by a nation that represents only 0.2% of the Old Continent's GDP.
- On the economic front, the Fed will be announcing its key rate decision at 2 p.m. today. Markets do not anticipate a change, with the rate remaining at 0.25%. According to a Bloomberg survey of economists, the FOMC should wait until the fourth quarter of 2013 before trimming its monthly injection of $85G into the bond market. In short, investors should keep one eye on the U.S. and the other looking across the Atlantic today. Wishing you a great day. Xavier Villemaire.
- Range of the day: 1.0215 - 1.0300
- Range of the next 5 days: 1.0075 - 1.0400
