Marc Chandler submits:The euro is center stage today. It is gaining on nearly all the other currencies today, including the Scandi-bloc, which had actually been the best performer in recent days. Technically the move above the 100-day moving average is thought to have spurred new model-driven demand.
LAST year, the euro was just about the worst-performing of the thirty-odd “major” currencies tracked by Bloomberg. That seems fitting: the sovereign-debt crisis at the euro zone’s edges was the biggest macroeconomic nasty in 2010. The wonder is that the euro did not fall harder. It lost “only” 6.6% of its value against the dollar, not a huge sell-off for a currency whose very existence seemed under threat. Even now, after an early-year rally in the dollar, the euro stands at $1.31 or so. That is comfortably above the $1.15-1.20 range that is widely considered as fair-value.
Italian Prime Minister Mario Monti on Wednesday said the root of Europe's debt woes lay partly in the irresponsible parenting of Germany and France during the bloc's infancy.Monti told reporters in Tokyo that because the eurozone's two largest players had not abided by fiscal rules, they had set a bad example for the rest of the continent."The story goes back to 2003 (and) the still almost infant life of the euro," Monti said."It was in fact Germany and France that were loose concerning the public deficits and debts."
Marc Chandler submits:Earlier today, French Prime Minister Fillon reiterated recent remarks by other French officials bemoaning the euro's strength against the dollar. The euro has slid almost 6.75% against the US dollar since late November, meaning that over the past six months it is essentially flat (-0.71% according to Bloomberg data).Fillon's remarks were reportedly made in the context of a broader discussion of French competitiveness.