ForexNewsNow – The euro was stabilizing on Tuesday as many investors profited from the sharp rise of the euro on Monday. This sudden rise can be explained by the commitments made by French and German leaders over the weekend to strengthen Franco-German banks and to provide a new proposal to resolve the debt crisis by the upcoming G20 summit.
The euro was slightly decreasing in value against the US dollar today, trading at 1.33638 as of around 08:30 A.M. GMT.
The EUR/USD pair is down 0.022% on the day and has reached a session high of 1.3672 with a low of 1.3617. The foreign exchange market should remain optimistic in order to counterbalance the “excessive pessimism” of recent weeks.
“The meeting between Sarkozy and Merkel has raised serious hopes that the recapitalization of banks will allow Europe to solve its problems, and good US employment numbers suggest that the US economy will restart smoothly,” said Dai Sato, an analyst at Mizuho Corporate Bank.
Investors should also be encouraged by the sharp rise in Asian stocks exchanges as they are also waiting impatiently for the opening of the season’s third quarter results in the United States on Tuesday for guidance on the impact of this summer stock market crisis on the balance sheets of the American companies.
They will also be paying attention to the vote in Slovakia on the European support fund, which is expected to take place on Tuesday and which could be a nasty surprise for the euro and the euro zone.