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Forex - EUR/USD holds gains ahead of Greek bailout decision

Published 02/20/2012, 10:13 AM
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Investing.com - The euro remained higher against the U.S. dollar on Monday, but gains were capped by last minute jitters as euro zone finance ministers were meeting to discuss Greece’s second bailout package.

EUR/USD hit 1.3277 during U.S. morning trade, the pair’s highest since February 13; the pair subsequently consolidated at 1.3245, gaining 0.81%.

The pair was likely to find support at 1.3154, the low of February 10 and resistance at 1.3320, the high of February 9.

Speaking ahead of the meeting in Brussels, Greek Finance Minister Evangelos Venizelos said negotiations on the EUR130 billion bailout and a linked debt restructuring deal would continue until the last minute but added that Greece has met all the conditions demanded by its creditors.

“We expect the long period of uncertainty, that benefitted neither the Greek economy nor the euro zone overall, to end today”, Venizelos said.

Sentiment on the euro was also boosted after Germany’s central bank said in its February report that the outlook for the economy in the year ahead had improved “perceptibly”.

In addition, the People’s Bank of China said Saturday that it was to cut the reserve requirement ratios of major commercial lenders in an attempt to boost liquidity and spur growth in the world’s second largest economy.

Elsewhere, the euro was also sharply higher against the pound with EUR/GBP climbing 0.64%, to hit 0.8355.

Trade volumes were expected to remain light on Monday, with markets in the U.S. remaining closed for the Presidents Day holiday.


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