Friday, March 19, 2010
Once again risk aversion is taking center stage as traders are buying the Dollar and shedding higher risk currencies. The main concern driving the Dollar higher overnight is Greece’s
ability to obtain financial aid. Traders are pricing in the strong possibility that Greece will not receive aid from the European Union and be forced to turn to the International Monetary Fund for
Although Greece agreed to austere budget cuts to pacify the EU, it seems that despite these moves members still are against providing aid to the ailing Greek economy. Greece needs the
funding to get through this difficult transition period but cannot afford to go to the open market to borrow money because of the high interest rate it would have to pay. The cost to borrow would be
prohibitive and the amount of money required to service the debt would cripple the economy.
Volatility is high because of the persistent rumors that keep circulating regarding the Euro. New reports overnight suggest that German officials have indicated support for a joint
bailout of Greece …