FOREX DAWN| Euro Perspective

The Euro has taken a bashing recently losing 16% of it’s value since the start of the year, but is it really a problem? Lots of European countries have just crawled out of recession and with the ever present threat of a double dip just round the corner a cheap Euro is in my opinion not such a bad thing. In fact many see the currency as over valued by as much as 7% against the dollar, the Euro is far from being a weak currency, the problems seem largely political.
The advantages are in a countrys exports which typically become cheaper, creating demand which helps the job market which eventually helps the deficits, a real boost for economic growth in the Eurozone. Europeans will however pay more for imports, especially energy sources like oil. There is no fixed rate now so all currencies fluctuate, it is the nature of the beast, it was only last year that the funeral was being prepared for the dollar but that didn’t happen, and the Euro will recover as well, it may be a slow recovery though as some countries need to get their house in order.

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