The euro dropped below $ 1.20, Stock unscrew
Saturday, June 5th, 2010The euro fell below $ 1.20 and the stock markets have plunged into the red on Friday, sealed by disappointing figures for U.S. employment and the fear of contagion from the euro area. Trained in turmoil, oil lost almost $ 3: Towards 1600 GMT Brent North Sea yielded 2.83 dollars to 72.58 dollars a barrel.
In closing, the London Stock Exchange closed down 1.63%, 2.86% Paris, Frankfurt 1.91%, 3.80% Madrid, Milan and Athens 3.79% 5.03 %. And the Dow Jones in New York lost 2.3% to 1630 GMT.
In the U.S., unemployment fell in May to 9.7%, but the net new jobs (431,000) were worse than the 500,000 expected. The markets also remained concerned about the economic slump in Europe, which has pushed the euro to below $ 1.20 for the first time since March 2006.Around 3:35 p.m. GMT, the dollar posted 1.1993.
Even before the publication of these figures, the traders have fled risky investments and sought refuge with values that are safer as the U.S. dollar and Swiss franc."After a few days away from the spotlight, the debt crisis in Europe is back on the front of the stage," noted and David Morrison, an analyst at GFT, citing the risks of contagion from the crisis in Europe outside the euro area to Hungary and Romania.
In Hungary, alarmist statements from officials of the ruling on the country's economic situation has undermined the financial credibility of a State which is to avoid bankruptcy, under infusion of 20 billion euros available by the International Monetary Fund (IMF), the European Union (EU) and European Central Bank (ECB) since autumn 2008.
But it seems that the euro has also suffered from About … Fillon.Asked at a press briefing with his Canadian counterpart Stephen Harper on slide in the single currency, Prime Minister launched it saw "good news in that the parity between the euro and the dollar."
Media outlets have economic Anglophone immediately heard "parity" ("parity" in English) in its narrow sense of perfect equality. They have deduced that the head of government called the equivalence of his wishes: 1 euro equals one dollar. An avalanche of "urgent" then falls among their clients.
As a result, operators of foreign exchange markets feel encouraged to sell the euro.Within minutes, the single currency reached its lowest level in four years, to below $ 1.20.
But the following remarks by François Fillon said that he wanted "parity" in its other sense, the dictionary defines as "exchange rate of one currency against another."
"For years, the President of the Republic, we complain that this parity between the euro and the dollar does not reflect the reality of our economies and hinders exports. I am not worried about the current parity between the euro and the dollar, "he saidFillon.
"There is no doubt that these ideas have been down the euro, even though they occurred" after two little incidents "in the markets, the rise of the Swiss franc against the euro and rumors exposure to a European bank to derivatives, according to David Deddouche, currency strategist at Societe Generale.
Realizing the mistake, Matignon responds quickly: the entourage of the Prime Minister informed the reporters that "by parity, he meant + + level of the euro against the dollar." But the damage is done. "This correction, no one has seen," said David Deddouche.
However, the decline of the euro is really good news: see the video, the comments of Beatrice Mathieu Prediction Center Expansion.