Monday, October 1, 2012
Euro, Australian Dollar Up on U.S. Mfg Data
The euro and Australian dollar moved up early Tuesday on news that manufacturing in the U.S. expanded in September; the first move in positive territory since May.
In response, the U.S. dollar dropped while commodities in general responded by climbing. The euro got a reprieve from three-week lows,
As for factories in the euro zone, they ended the worst quarterly performance since the early part of 2009. China also continues to slow down, although that hasn't been as much of a surprise because of the announcement by Chinese leaders some time ago that they were going to attempt to cool off their fast-growing economy.
The Australian dollar jumped to $1.0366, while the euro climbed to $1.2895, after falling as low as $1.28035 in Monday trading.
Questions concerning the euro remain as uncertainty as to when Spain will officially seek a bailout, and also the possibility of its credit rating being downgraded to junk status by Moody's (MCO).
Societe Generale said concerning Spain, "The Spanish government probably thinks it needs to find a way of presenting the request for assistance as a victory of sorts, just like it did for the bank deal, to its electorate."
Spain has positioned itself to access aid by releasing a budget that has significant cuts for 2013. That also included a series of economic reforms after it banks went through stress tests in preparation of aid.