Euro on Fire, Hits 4-Year High Vs Dollar

[Frank]

Euro on Fire, Hits 4-Year High Vs Dollar

By Daniel Bases

http://www.reuters.com/financeNewsAr...toryID=2707482

NEW YORK (Reuters) - The euro soared to a four-year high against the dollar on Thursday after the European Central Bank left benchmark interest rates unchanged, preserving the U.S.-euro zone interest rate gap that has benefited the euro.

The euro also rose versus the yen, while fears the Bank of Japan would step in to sell yen for dollars kept the Japanese currency from breaking through a critical high against the greenback.

With the ECB's benchmark rate at 2.50 percent compared to the U.S. fed funds rate of 1.25 percent, investors are trading dollars for euros and shifting cash into the euro zone in search of higher yields.

'The dominant theme remains the euro yield strength and after this morning's decision, that theme was resoundingly reinforced,' said Joe Francomano, vice president of foreign exchange at Erste Bank.

The euro is up 9 percent against the dollar in the past six weeks.

[tam]

Yeah, 1 euro is currently $1,15

[Zaphod Beeblebrox]

It's not so much the euro rising as the dollar dropping, I think.

[FaDe]

Cheers!

[IFF]

this is bad news i think, as now irish exports into american and the uk markets are going to make our products dearer and less competitive

or atleast is my understanding of the currency market

[Manu]

IFF -

Is Ireland part of the Euro?

This would make your products worth 'more' in that case, going into an American market.

This I do feel is probably more a result of a weaker US dollar than a strong Euro. But, the effect is the same.

It is going to be a REALLY interesting next year until the election. The economy hasnt' rebounded, all the media talks about is terror/war, and unemployment, international finances, infaltiions, etc are all doing poorly...

[86Dude]

Yeah, this was predicted, but the American economy won't stay down forever. A little competition is a good thing I suppose.

[tam]

Originally posted by Manu
This would make your products worth 'more' in that case, going into an American market.

true, so american companies who buy european products will need to pay more in dollars, which kills the european competitiveness, especially since they don't get more euros for it per saldo. Economically it's not good for products etc, but good for monetary investors i suppose. European investors can buy large amounts of dollars with their euros and just wait till the values goes up again, and sell it off at a profit.

[JAT]

So long! Say goodbye! Say "adios" to your SUV's, cellular phones, Starbuck's coffee, imported water, football afternoons, and shopping at the mall. So long, America. Exit stage left. Enter the foul, wretched dreck that has been festering under your bloated and untended national epitome of decadence.

Hey, keep waving those plastic, imported from China, U.S. flags, though. You never know; waving a flag just might avert the imminent disaster.

[IFF]

Originally posted by Manu
IFF -

Is Ireland part of the Euro?

yeah ireland is part of the euro