May 19, 2012 07: 41 GMT
Euro: "Save time" may not work for the moment that the crisis intensifies
Fundamental forecasts for the Euro: decline
There are many comparisons made to the current conditions of the euro market and these back in the second quarter of 2010, when evil has begun brewing for the Greece. However, it is perhaps better draw connections to the situation today and the second half of 2008. With the crisis financial three years and a half years, investors and politicians were skeptical that the situation could spiral out of control so quickly because of the interconnection of global financial markets and the speed with which panic can spread. This time, recent history has been the conservative masses, responsible policies were clearer threshold in the course of which they will act and is less leverage detail behind the current peaks. That said, we have undertaken the dependence of the Central Bank and the support of the Government, the growth slows once more the source of the next global pandemic potential is a problem arrive long, structure of the Euro area.
For two years now, the modus operandi of European officials was "save time". Intentional or not (in most cases it is not intentional), changes in policy and rescue received a short period of calm market rather that truly resolved the underlying problems. Yet, as with the decreasing influence of we facilitate programs on the country's capital markets, the market was found less less reprieve efforts of officials of the EU as of the end. There are several "hot spots" which are managed at this time.
The most important concern (in other words, most friendly title) is the possibility of a Greek exit from the Euro area. The is a major threat to the common currency, because the impact of this worst-case-scenario is so important - and is no longer such a result far-fetched. However, the table of time of this threat, is probably not as bad as the media so wishes it (it it bleeds, it leads). Speculation that the country must announce his release the next week are unreasonable, as a decision may not be made under an interim Government. On the other hand, recovery after having sunk at this depth is unlikely. For now, we wait until the next so-called election June 17 to see what that next steps will also be few decisions happen without a Government.
Broader concern of another, is the financial health of the entire region. Spain seems particularly at risk. We have seen flight of capital in the banking system, a closed market for funding and trouble with warranty run the Greece on the collapse of the banking sector. Now, we begin to see similar symptoms in Spain. The nationalization of the Nucula, a forced between shaky cajas merger and the reports of massive recalls refers to spread panic. If it is not quickly suppressed, we will have a serious problem, it returns quickly to the other countries of rescue (Ireland and Portugal) and potentially even exposed key members (as the Italy).
Most of our fundamental guidelines this week will come via the major themes and titles financial splashy, but there are a few planned milestones that must be monitored. We have regional consumer confidence figures on Tuesday, and a Spanish bond auctions and the EFSF. Thursday, there is a second reading of German GDP figures (components can see a significant revision), but reading the actual growth rate is the digits of the PMI may - accurate proxies and appropriate time for regional activity. Beyond that, we need to look at what say makers. They are a solid or continuous front head on the road to surrender? -JK
DailyFX provides news forex and technical analysis on trends affecting the world market currencies.
Learn forex trading with a free account of practice and exchange of graphics of FXCM.
May 19, 2012 07: 41 GMT
Euro: ‘Buying Time’ May Not Work This Time as Crisis Intensifies
Euro: "Save time" may not work for the moment that the crisis intensifies
Fundamental forecasts for the Euro: decline
There are many comparisons made to the current conditions of the euro market and these back in the second quarter of 2010, when evil has begun brewing for the Greece. However, it is perhaps better draw connections to the situation today and the second half of 2008. With the crisis financial three years and a half years, investors and politicians were skeptical that the situation could spiral out of control so quickly because of the interconnection of global financial markets and the speed with which panic can spread. This time, recent history has been the conservative masses, responsible policies were clearer threshold in the course of which they will act and is less leverage detail behind the current peaks. That said, we have undertaken the dependence of the Central Bank and the support of the Government, the growth slows once more the source of the next global pandemic potential is a problem arrive long, structure of the Euro area.
For two years now, the modus operandi of European officials was "save time". Intentional or not (in most cases it is not intentional), changes in policy and rescue received a short period of calm market rather that truly resolved the underlying problems. Yet, as with the decreasing influence of we facilitate programs on the country's capital markets, the market was found less less reprieve efforts of officials of the EU as of the end. There are several "hot spots" which are managed at this time.
The most important concern (in other words, most friendly title) is the possibility of a Greek exit from the Euro area. The is a major threat to the common currency, because the impact of this worst-case-scenario is so important - and is no longer such a result far-fetched. However, the table of time of this threat, is probably not as bad as the media so wishes it (it it bleeds, it leads). Speculation that the country must announce his release the next week are unreasonable, as a decision may not be made under an interim Government. On the other hand, recovery after having sunk at this depth is unlikely. For now, we wait until the next so-called election June 17 to see what that next steps will also be few decisions happen without a Government.
Broader concern of another, is the financial health of the entire region. Spain seems particularly at risk. We have seen flight of capital in the banking system, a closed market for funding and trouble with warranty run the Greece on the collapse of the banking sector. Now, we begin to see similar symptoms in Spain. The nationalization of the Nucula, a forced between shaky cajas merger and the reports of massive recalls refers to spread panic. If it is not quickly suppressed, we will have a serious problem, it returns quickly to the other countries of rescue (Ireland and Portugal) and potentially even exposed key members (as the Italy).
Most of our fundamental guidelines this week will come via the major themes and titles financial splashy, but there are a few planned milestones that must be monitored. We have regional consumer confidence figures on Tuesday, and a Spanish bond auctions and the EFSF. Thursday, there is a second reading of German GDP figures (components can see a significant revision), but reading the actual growth rate is the digits of the PMI may - accurate proxies and appropriate time for regional activity. Beyond that, we need to look at what say makers. They are a solid or continuous front head on the road to surrender? -JK
DailyFX provides news forex and technical analysis on trends affecting the world market currencies.
Learn forex trading with a free account of practice and exchange of graphics of FXCM.
May 19, 2012 07: 41 GMT
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