The euro managed to post weekly gains even as the market sentiment turned negative by the weekend. The situation with Spain is still uncertain, though, and that uncertainty can weaken the 17-nation currency in the coming week.
The European Union summit did not clear the picture and Spain is still reluctant to ask for a bailout as the austerity measures, demanded in exchange for aid, are very unpopular among Spain’s citizens. Spanish Prime Minister Mariano Rajoy indicated that he is not in a hurry to ask for rescue. Still, the earlier good news helped the euro to limit losses. Moody’s Investors Service maintained Spain’s credit rating and yields on Spanish and Italian bonds fell.
As for other parts of the world, the news was mixed. Fundamental reports from China were generally good, but traders were unsure if that is really good for the Forex markets. Macroeconomic data from the United States was favorable for the most part, but the bigger-than-expected rise of unemployment claims spoiled the positive effect of US fundamentals.
EUR/USD rose from 1.2953 to 1.3019 and the weekly high was at 1.3138 — the highest level since September 17. EUR/JPY went up from the opening price of 101.59 to 103.24, but retreated from the weekly high of 104.11 — the highest since May 8. EUR/GBP climbed from 0.8051 to 0.8132 this week, while the weekly high was at 0.8144 — the price not seen since June 15.
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