Forex - EUR/USD rises as Greece accepts austerity

Published 02/12/2012, 07:37 PM
Updated 02/12/2012, 07:43 PM
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Investing.com - The euro rose against the dollar early Monday as the Greek Parliament voted to accept tough austerity measures demanded by its European neighbors in exchange for bailout money needed to avoid a default.

In Asian trading on Monday, EUR/USD hit 1.3237, up 0.30%, firming from a session low of 1.3201 and off from a high of 1.3260.

The pair was likely to find support at 1.3156, Tuesday's low, and resistance at 1.3320, Thursday's  high.

Greece needed its Parliament to approve austerity measures in order to gain access to EUR130 billion in assistance funding to avoid a messy default in March.

Greece had spent weeks negotiating with the E.U., the E.C.B. and the I.M.F., organizations demanding the country adopt tough and politically unpopular austerity measures to streamline its public finances in exchange for bailout money.

Parliamentary approval was a big step towards securing aid, which sent the euro climbing.

"As the votes came in and it looked like they were going to get enough votes, the euro lifted about 40 points. That’s certainly a reason for a euro high today," said Joseph Capurso, a currency strategist in Sydney at Commonwealth Bank of Australia, according to Bloomberg.

"The market’s already reacted to that and it will be now looking forward to the next thing."

The euro, meanwhile, was up against the pound and the yen, with EUR/GBP rising 0.14% to 0.8388 and EUR/JPY rising 0.31% at 102.74.

In the U.K., the Royal Institution of Chartered Surveyors' House Price Balance will hit the wire on Monday.

Later Monday, Australia is to publish business confidence figures.

Also Monday, Switzerland is to release official data on producer price inflation, an important gauge of consumer inflation.




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