(EU) ECB said to have approved 40 new workers to help in attempts to deal with debt crisis.
(EU) UK newspaper Daily Telegraph’s Euro-skeptic in chief, Ambrose Evans-Pritchard: Germany’s director at the ECB has thrown his weight behind mass purchases of Spanish and Italian debt to prevent the disintegration of the EMU, marking a crucial turning point in the Eurozone debt crisis (for the better).
How to interpret these headlines:
High yields in the bond markets are direct results of risk sentiments, and to cap yields, what ECB essentially is proposing is to ban “fear”. This would address underlying issues that are responsible for pushing solvent members to bailout requests, thus cutting bond speculators at their knees. Considering that Germany is backing this proposal instead of the usual opposition, market is extremely positive over this new development by pushing the EURUSD above the 1.2470 level, breaking the upper resistance of 1.2440…
With rumors flying high, especially with the new one about ECB may go ahead with bond purchases despite of opposition from Germany, this is indeed a better outcome that no one saw coming, especially considering Asmussen’s support on unlimited bond purchases to cap bond yields… I believe Euro traders have what they need to BUY the Euro, as we may get official announcements in early September, this is indeed a turning point for the Eurozone debt crisis…
In conclusion, I’ll reiterate my previous article, I’d buy EURUSD on dips on potential ECB Intervention, economic improvements, and Fed’s QE3.
The Crucial Turning Point In The Eurozone Debt Crisis…
August 21, 2012 by 5 Comments