The decline of the euro was confined to 0

The clouds are gathering over the single currency. The euro is poised to sign his second month in a row of against the dollar, while it was previously appreciated for five months. Yesterday, he went under 1.40 dollar threshold, for the first time since mid-July. At the end of European session, he treated against 1,3973 dollar.

The woes of the Greece are sufficient to explain this movement The recent cacophony around the country is certainly not foreign to the fragility of the euro. Each day brings its lot of information and denials. Yesterday, the Germany and the France refuted the "world" information that eurozone States prepare plans of rescue of the Greece. The day before, Athens has indicated that he had no discussions with China to raise 25 billion euros, as indicated by the "Financial Times". Contribute to muddying and increase uncertainty in a country where the tax situation is critical. "Market participants are testing mechanisms of assistance to the Greece," recognizes Valerie Perez, in Deutsche Bank. But these "tests" are much more virulent in the bond market: yesterday, the Greek 10-year rate yet recorded a voltage of exceptional magnitude ( 40 basis points), 7,142. The decline of the euro was confined to 0.48. The day before, the comparison was even more eloquent. The Greek 10-year rate flew 49 basis points, while the single currency gave 0.43.

Fear of contagion

Further threatening the euro, it is a movement of contagion. The Greece, as Jean-Claude Trichet, the President of the European Central Bank (ECB), is the "California" in the euro area, it weighs less than 3 of GDP. But if fears about the other peripheral countries - even the hard core - economic and Monetary Union (EMU) earned in intensity, then the single currency would be in a more intense turbulence zone.

Concerns about the Portugal are already strengthened since the presentation, two days ago, of the 2010 budget proposal. "It integrates a revision to the increase in the budget deficit, 2009, to 9.3 of GDP, and provides a deficit 2010 a little higher than expected," noted yesterday Moody's. The rating agency considers that the proposal by the Portuguese Government "shows the magnitude of the challenges the country". In these circumstances, it was not surprising to see the risk premium of the Portugal increase yesterday. The rate to 10 years tended by 16 basis points, to 4,386. Ireland ( 10 basis points) and Spain ( 8 basis points), which are on the list of countries with strong "sovereign risk", were also a bit chahutés.

Initiation of change to the Fed

But, at this stage, these phenomena are not sufficient to explain the decline of the euro. Its decline is also the effect of a strengthening of the dollar. "The tightening of the conditions of credit in China and Obama comments on bank regulation have marked a turning point," David Deddouche, in Société Générale analysis. According to strategist, the market is to realize that 2010 will not as good as expected, combining economic growth, abundance of liquidity and accommodative monetary policy. The release of the Fed at the end of its meeting Wednesday, also reflects this change initiation: one of the members of the Committee even wished to remove the mention on keeping rates low "for a prolonged period", finding that the economic and financial conditions demanded more. These signals also benefit the dollar, which once more his role of refuge currency. Yesterday, the dollar was 0.26 against the six other major currencies. The experts believe that the technical threshold of 1, 38-1, 37 dollar may soon be crossed by the single currency.