As this week comes to an end, optimism dominates the market ahead and after the critical vote from Italian Senators that passed the austerity measures needed to support Italy to avert following Greece's steps into deep crisis, where optimism spread in the market after Greece was able to end the political conflict, while Italy accelerated the implementation of the budget plan.
The euro extended the gains recorded yesterday, and recovered some of the losses incurred during the week, where we see the sentiment improved somehow, while Italian steps could support markets to restore confidence, which supported the euro to positive momentum on the Italian vote, where this critical vote could affect the euro zone as whole, as Italy is considered too big too bailout and providing strong protection for Italy could save the one currency union.
The U.S. dollar index (USDIX) started the day at 77.60 and set the highest at 77.73 and the lowest at 77.35, and is currently hovering around 77.47.
Optimism extended in the market today as European government started to take the debt crisis seriously and provided several attempts to contain the debt crisis and end it once and for all, where Greece named the new government yesterday as Lucas Papademos, the former European Central Bank Vice President, became the new Premier and now his objective is clear, which is leading the country towards the financial aid that is needed as soon as possible for Greece in order to avert an early default.
The euro gained strength against the U.S. dollar as jitters and market tension eased in Europe, which led investors to hold risky investments after their risk appetite improved; however, the U.S. dollar lost positive momentum as investors are optimistic and positive and market expectations indicate that the vote will pass the Italian senators easily especially after the upper house budget committee approved the plan late yesterday.
The EUR/USD pair opened the session today at $1.3603 and recorded the highest at $1.3667 and the lowest at 1.3577, and is currently trading around 1.3640.
On the other hand, the Japanese yen gained strength again against the weakening U.S. dollar, where the Bank of Japan's last intervention lost the effect, while the JPY/USD pair ended a strongly bearish week and is gradually declining, hurting the nation's exports and the economy as a whole.
The USD/JPY pair opened the session today at 77.62, and recorded the highest at 77.68 and the lowest at 77.30, and is currently hovering around 77.35.