Currency Countdown

ECB May Allot 470 Billion Euros in 3-Year Crisis Loans

2012-02-24T10:39:03-05:00

Euro-area banks may tap the European Central Bank next week for almost as much three-year cash as they did in December in an operation that could prolong a rally in bond markets. Financial institutions will ask the ECB for 470 billion euros ($629 billion) in three-year funds for allotment on Feb. 29, the median of 28 estimates in a Bloomberg News survey shows. While that’s less than the record 489 billion euro take-up at the first tender on Dec. 21, it may increase total cash in the system by more than 300 billion euros, said Luca Cazzulani, a senior fixed-income strategist at UniCredit SpA in Milan.

Europe's banks bleed from Greek debt crisis

2012-02-24T10:25:15-05:00

The scars of Greece's debt crisis were laid bare in heavy losses from a string of European banks on Thursday, and bosses warned the region's precarious finances would continue to threaten economic growth and earnings. From France to Germany, Britain to Belgium, four of the region's biggest banks lined up to reveal they lost more than 8 billion euros last year from their Greek bonds holdings.

Euro Hits Multi-month Highs Vs Dollar, Pound, Yen

2012-02-24T10:07:40-05:00

The euro rose to multi-month highs against the dollar, yen and pound in European hours Friday as currency traders looked ahead positively to next week's promise of more liquidity from the European Central Bank, encouraged by the progress made in Greece and by tentative signs of global economic improvement. The single currency rose to its highest level against dollar since Dec. 9, pushing above $1.34. It also rose above JPY108 against the yen for the first time since Nov. 7 and briefly popped above GBP0.85 against sterling.

LIR – Watch Oil. Watch America.

2012-02-24T03:50:25-05:00

Another Friday and another opportunity for Greece to come to its senses and repudiate the shameful deal Germany forced on Greece at the start of the week. As further details come out, according to the Financial Times, Greece has till the end of the month, just 5 days away, to make 38 specific dictated “changes in Greek tax, spending and wage policies.” Marry in haste repent at leisure, goes the old saying. There is absolutely no way any parliament can scrutinise in any informed way 38 pieces of major legislation in the space of 5 days. Greece is headed to default. But first this. European creditor countries are demanding 38 specific changes in Greek tax, spending and wage policies by the end of this month and have laid out extra reforms that amount to micromanaging the country’s government for two years, according to documents obtained by the Financial Times.

Germany Defies Euro-Area Recession as Italy Contracts

2012-02-23T15:35:12-05:00

German business confidence rose more than economists forecast to a seven-month high in February as Europe’s largest economy bucks a recession that’s gripping the region’s southern fringe. The Munich-based Ifo institute said its German business climate index, based on a survey of 7,000 executives, climbed to 109.6 from 108.3 in January. That’s the fourth straight gain and the highest reading since July. Economists predicted an increase to 108.8, the median of 38 estimates in a Bloomberg News survey.

EU says eurozone economy to shrink in 2012

2012-02-23T14:15:41-05:00

The European Commission has predicted that the eurozone economy will contract by 0.3% in 2012. In its previous forecast in November, it said that the economy would grow by 0.5%. "The unexpected stalling of the recovery in late 2011 is set to extend into the first two quarters of 2012," the Commission said. But it added that the 17-nation bloc would only have a "mild" recession and that it saw signs of stabilisation.

Junk Bonds Seen Rallying as Europe Crisis Wanes

2012-02-23T14:11:44-05:00

Junk bond returns may triple from last year as confidence builds that Europe will avert a sovereign-debt crisis and investors turn their attention to a U.S. recovery, according to analyst forecasts. JPMorgan Chase & Co. strategists led by Peter Acciavatti, the top-rated high-yield team in Institutional Investor magazine’s annual poll, raised their estimate last week for 2012 gains to 13.7 percent from 9.4 percent. While Bank of America Merrill Lynch expects returns of 12.3 percent, Barclays Capital is holding with 5 percent to 7 percent, saying Greece is still grappling with fiscal challenges.

China Says EU Trade Probe Harms Debt Crisis Effort

2012-02-23T12:16:11-05:00

China said Thursday that a European Union investigation into Chinese steel products would damage joint efforts to cope with the euro-zone debt crisis, suggesting that Beijing may link its aid to concessions on trade and other matters. China is "intensely displeased" about the EU's antisubsidy investigation into organic coated sheet steel products imported from China, and the move will send a "wrong signal of trade protectionism" to the world, the country's Ministry of Commerce said in a statement.

European Stocks Decline on Concern Economy Will Shrink in 2012

2012-02-23T12:10:03-05:00

European stocks declined as the European Commission said the region’s economy will shrink this year, dragged down by Italy and Spain. Commerzbank AG tumbled 5.5 percent after saying it won’t pay a dividend for 2011 and will ask investors to swap some hybrid instruments for shares. Swiss Re Ltd., the world’s second-biggest reinsurer, gained 3.9 percent after raising its shareholder payout.

Greece readies launch of debt swap for rescue

2012-02-23T10:29:17-05:00

Greece's parliament was expected to endorse a debt swap with private bondholders on Thursday that forms the core of its 130-billion-euro bailout, despite new protests against tough budget cuts demanded in return for the rescue deal. The swap, in which private investors exchange their bonds for lower-value debt, will slice 100 billion euros ($132 billion) off Greece's debt, a vital part of the EU and IMF bailout plan aimed at cutting Greece's liabilities from 160 percent of gross domestic product to 120.5 percent by 2020.