By TraderVox.com
Tradervox (Dublin) – The 17-nation currency has been on the low for the third week now; however, the German GDP which came in better than the market was expected helped the euro to pare some of the losses it had incurred due to political situation in Europe. The euro has rebounded from almost a four-month low after German GDP report was released.
The euro had earlier declined against the dollar and the yen as concerns that Greece will exit from the 17-nation trading bloc increased as finance ministers met for the second time to discuss the issue. However, the demand for the dollar was also limited as the market awaits the Federal Reserve Minutes tomorrow.
A report from Germany showed the gross domestic product for the country grew by 0.5 percent in the last quarter from the previous three months ending December 2011 when it declined by 0.2 percent. Economists had predicted a growth of 0.1 percent in the GDP. The report has led to the increase of the euro against major currencies, and analysts have associated the recent buying of the euro as a result of the report from Germany.
The euro gained 0.2 percent against the dollar to trade at $1.2847 at the start of London session. Earlier, the 17-nation currency had dropped to its weakest since January 18 to trade at $1.2814. Against the Japanese currency, the euro gained 0.2 percent from a February 16 low of 102.23 to trade at 102.61. The yen dropped marginally against the greenback trading at 79.88 yen from 79.85 it had registered earlier.
Euro’s gain is limited by the continuing turmoil in the euro-zone as major pro-austerity governments are being replaced by anti-austerity governments in the region. The new French President Francois Hollande has vowed to fight austerity measures, while in Greece, the President is holding meeting with political leaders to ensure that a government of national unity is formed to avoid going into another poll.
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