Breaking News
Get Actionable Insights with InvestingPro+: Start 7 Day FREE Trial Register here
Investing Pro 0
Ad-Free Version. Upgrade your Investing.com experience. Save up to 40% More details

Forex - Dollar firms as Spanish worries spark risk-off session

ForexJul 20, 2012 03:31PM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
Investing.com - The dollar soared against most major global currencies on Friday after Spain said it's economy will remain mired recession for another year, sending investors rushing to the safety of the dollar.

In U.S. trading on Friday, EUR/USD was down 0.96% at 1.2163.

Spanish Budget Minister Cristobal Montoro said earlier that the recession gripping the country today will extend into next year, with gross domestic product falling 0.5 percent in 2013 instead of expanding 0.2 percent as originally forecast.

The news sent yields in Spanish government debt markets soaring to above 7%, a level deemed unsustainable by markets and illustrating a country in need of a bailout.

Investors rushed to safe-haven asset classes as part of a risk-off trading session, which fueled demand for the dollar especially.

The euro dipped to a two-year low against the greenback and fell to its a level against the yen not seen since 2000.

Eurozone ministers did sign off on terms to give Spain EUR100 billion in bailout money for its banking sector as well as for regional governments, though investors fear the country itself will need a sovereign rescue, further fueling dollar demand.

The regional government of Valencia in Spain, meanwhile, said it would need assistance from Madrid, which helped push the euro lower against the yen, also a safe-haven currency.

Earlier this year, the Catalonian government said it would financial assistance from the Spanish government, as the country wrestles with debt burdens stemming from the real estate collapse.

The dollar rose in recent sessions after Federal Reserve Chairman Ben Bernanke gave no indication during congressional testimony that the economy is in greater need of monetary stimulus despite softening economic indicators, including monthly jobs reports that have continued to disappoint.

Still, market talk the Fed will eventually stimulate the economy via monetary easing tools, which capped the dollar's gains.

The greenback, meanwhile, was up against the pound, with GBP/USD trading down 0.70% at 1.5616.

The dollar was down against the yen, with USD/JPY trading down 0.13% at 78.48, and up against the Swiss franc, with USD/CHF trading up 0.95% at 0.9873.

The dollar was up against its cousins in Canada, Australia and New Zealand, with USD/CAD up 0.52% at 1.0126, AUD/USD down 0.51% at 1.0375 and NZD/USD down 0.55% at 0.7988.

The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was up 0.74% at 83.59.








Forex - Dollar firms as Spanish worries spark risk-off session
 

Related Articles

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
or
Sign up with Email