Tags: Euro | Slide | take | Down

Experts: Euro’s Slide May Take Down Others With It

Wednesday, 14 Dec 2011 11:47 AM

The euro is due for a long weakening trend, possibly bound to hit $1.20 thanks to the debt crisis that refuses to end, experts say.

The euro recently broke the $1.30 mark and will likely consolidate around there only briefly before resuming its weakening trend.

While the European debt crisis has raged for two years now, exchange rates have held somewhat steady all things considered, although that will change as the continent slides back into recession and defaults become increasingly likely.

"It certainly has a different flavor from what we've had happening," Nomura's chief G-10 currency strategist Jens Nordvig tells CNBC.

"I think we're probably going to consolidate around $1.30 this week, but I wouldn't be surprised if we have a clean break after this," Nordvig says, adding the currency will hover around $1.20 in the first quarter of 2012.

While European nations recently agreed on greater economic and fiscal integration, Germany shortly afterwards reportedly voiced opposition to increasing the size of a bailout fund, which spooked currency markets.

Furthermore, other experts say, the U.S. is not immune to a declining euro.

"I think Europe is going into recession and the ripple effect on global growth next year is the story. People think the U.S. can skate by...To think we can avoid it is delusional," says Peter Boockvar, equity strategist at Miller Tabak, CNBC adds.

Others agree the euro's health is fading fast.

"The euro remains extremely vulnerable," says Jane Foley, a senior foreign-exchange strategist at Rabobank International in London, according to Bloomberg.

"Most people agree that for there to be a degree of solution we need to get governments to work together on the fiscal front, and yet the sovereignty of all the different countries by definition gets in the way of that."

© 2017 Newsmax Finance. All rights reserved.

 
1Like our page
2Share
StreetTalk
The euro is due for a long weakening trend, possibly bound to hit $1.20 thanks to the debt crisis that refuses to end, experts say. The euro recently broke the $1.30 mark and will likely consolidate around there only briefly before resuming its weakening trend. While the...
Euro,Slide,take,Down
294
2011-47-14
Wednesday, 14 Dec 2011 11:47 AM
Newsmax Inc.
 

Newsmax, Moneynews, Newsmax Health, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, and Newsmax World are trademarks of Newsmax Media, Inc.

NEWSMAX.COM
MONEYNEWS.COM
© Newsmax Media, Inc.
All Rights Reserved