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Euro skids as Italy votes 'No' on reform, dollar in demand
Reuters ^ | Dec 4, 2016 | Wayne Cole

Posted on 12/04/2016 3:45:55 PM PST by aquila48

The euro slid in Asia on Monday after exit polls showed Italian Prime Minster Matteo Renzi clearly losing a constitutional referendum that could end his career and destabilize the country's shaky banking system.

The single currency dropped to $1.0577 in thin trade, after starting around $1.0645 earlier. The dollar was underpinned by expectations of a U.S. rate rise this month, and even held its ground on the safe-haven yen at 113.20.

Dealers said Italian bonds were set to come under pressure as top-rated U.S. Treasuries and German bunds gained. Asian investors are often reluctant to trade on European developments, preferring to wait for the continent's markets to open.

Investors and Europe's politicians fear victory for the opposition 'No' camp could cause political instability and renewed turmoil for Italy's banks, pushing the euro zone towards a fresh crisis.

Renzi will address the nation around midnight (6.00 p.m. ET).

Ultimately, the danger is that Italy holds a vote on whether to leave the euro, possibly triggering a break up of the entire bloc.

Analysts at RBCCM argued that, based on what happened in 2012 at the height of the Greek crisis, such a risk could see the euro trade as low as $0.8000.

"It may sound extreme, but if a second euro zone crisis were to hit, with the U.S. dollar at a much stronger starting point, EUR/USD could arguably trade lower still," they wrote.

Markets had earlier taken some encouragement when Austria's far-right presidential candidate was soundly defeated by a pro-European contender, confounding forecasts of a tight election.

The European Central Bank also meets Thursday amid much speculation it will announce a six month extension of its asset buying program and widen the type of bonds it can purchase.

(Excerpt) Read more at reuters.com ...


TOPICS: Breaking News; Business/Economy; Foreign Affairs; News/Current Events; Politics/Elections
KEYWORDS: asia; banking; dollar; euro; italy; referendum
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To: aquila48

What was the all time high for the euro?


61 posted on 12/05/2016 9:08:47 AM PST by Red in Blue PA (war is peace, freedom is slavery, ignorance is strength, obama loves America)
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To: aquila48

Thanks for the explanation.

Sounds as if Italy is moving in the right direction.

Or at least the Italian voters are.


62 posted on 12/05/2016 10:05:11 AM PST by Iron Munro (If Illegals voted Rebublican 50 Million Democrats Would Be Screaming "Build The Wall!")
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To: Red in Blue PA
What was the all time high for the euro?

1.87 in July of 1973. Happened to have the page open when you posted. ;-)

63 posted on 12/05/2016 10:13:41 AM PST by Billthedrill
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To: aquila48; Mr. K

Mr. K, here’s a link to a great post answering our questions.


64 posted on 12/05/2016 10:22:13 AM PST by CottonBall (Thank you, Julian)
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To: Deo volente

Yes they would. It’s a very bizarre cult.


65 posted on 12/05/2016 12:35:36 PM PST by SaveFerris (Hebrews 13:2 Do not forget to entertain strangers, for ... some have unwittingly entertained angels)
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To: Read Write Repeat

And it usually starts with an economic malaise ....


66 posted on 12/05/2016 12:43:55 PM PST by SaveFerris (Hebrews 13:2 Do not forget to entertain strangers, for ... some have unwittingly entertained angels)
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To: Billthedrill

I was not aware the euro went that far back.


67 posted on 12/05/2016 4:18:44 PM PST by Red in Blue PA (war is peace, freedom is slavery, ignorance is strength, obama loves America)
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To: Red in Blue PA
It doesn't, it was introduced in 1999. The page I was quoting was evidently modeling - Euro Dollar Exchange Rate. My bad.
68 posted on 12/05/2016 4:24:29 PM PST by Billthedrill
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To: voicereason

My wife wants to go to Europe next year. And she usually gets what she wants. Which means I’ll have to break my promise to myself and fly again. All if God is willing.


69 posted on 12/05/2016 4:37:26 PM PST by Terry Mross (This country will fail to exist inmy lifetime. And I'm gettin' up there in age.)
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To: 9YearLurker
I remember when the Euro was below the dollar—and wouldn’t mind seeing that again.

Be careful what you wish for. The stronger the dollar becomes, the worse for our exports.

70 posted on 12/05/2016 4:50:44 PM PST by Bubba Ho-Tep ("The rat always knows when he's in with weasels."--Tom Waits)
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To: Bubba Ho-Tep

But the better for our imports...

Strong (and steady) is good, up to a point.


71 posted on 12/05/2016 6:38:04 PM PST by 9YearLurker
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To: unread

Yes, yes, yes, and yes to McCarthy.


72 posted on 12/06/2016 5:21:52 AM PST by Neoliberalnot (Marxism works well only with the uneducated and the unarmed)
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