| CATEGORY: NEWS AND ANNOUNCEMENTS |
Traders line up against euro |
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Tue 09 Feb 2010
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LONDON (SHARECAST) - Sterling and the euro continued to trade nervously against the US dollar today as traders bet the debt problems afflicting Greece will spread across the eurozone.
The pound hit an 8-month low against the dollar yesterday and while the euro rallied a little today it is still down 10% against the dollar since November.
Today’s rally follows reports Jean-Claude Trichet, European Central Bank president, is to leave a summit in Australia and attend a special meeting of European leaders on Thursday. That has prompted talk of a deal to support Greece being close.
Meanwhile, the Chicago Mercantile Exchange reported $7.6bn in short positions against the euro in the week to 2 February, the highest level since the single currency was created in 1999.
Nobel prize-winning economist Joseph Stiglitz, who is now an advisor to the Greek government, called for action to be taken to against the speculators.
“The speculators will always look for the weakest link,” he told Sky News. “What they’re doing now is a version of the Hong Kong double play in 1997-98," he said.
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