Tuesday, October 26, 2010

Citigroup (NYSE:C): Euro Overvalued Heading into November

Citigroup's (NYSE:C) head of G10 strategy in New York, Steven Englander, said heading into November's risk events, he sees the euro as being overvalued.

Some investors who got in at $1.40 on the euro now feel like they've been burned, and are feeling a "little worn down," according to Phil Streible, senior market strategist at Lind-Waldock.

Matthew Strauss, senior currency strategist at RBC Capital Markets in Toronto said, "Quantitative easing is all priced in so you will need to see very soft U.S. data indicating the need for large amounts of QE, or prolonged QE, to send the dollar lower.

The euro dropped in New York - after trading lower on weak Asian equity markets - with investors not willing to support the common currency near $1.40 based on the volatility surrounding the Nov. 2 U.S. elections and the Nov. 2-3 Federal Reserve meetings. The euro fell to an intra-day low of $1.3831 in New York trading.

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