Euro Slips As Dollar Climbs
The euro steadied at $1.32 on Friday morning after falling 0.8 percent against the dollar on Thursday. The common currency is weighed down by concerns about the eurozone's fragile recovery and speculation about the Federal Reserve's tapering.
Reuters reported that strong economic data from the US helped support predictions that the Fed will start cutting back on its stimulus plan in September. The Commerce Department released a report which showed that the US economy expanded at a 2.5 percent annual rate in the second quarter. The figure more than doubled the rate of growth in the first quarter due to growth in exports.
Italy held a debt auction which was relatively successful, however investors remained concerned about the country's political uncertainty. The country's already fragile coalition government has been under pressure recently after Silvio Berlusconi threatened to take down the entire coalition if he was asked to step down.
In Greece, a funding gap has brought to light the fact that the country will likely need another loan from its international lenders. In an attempt to help Greece cut down its public sector, international lenders plan to move state owned real estate to a eurozone managed holding company. The plan will be presented to the troika in September, but so far, Greek officials have rejected giving up control of state property.
In the terms of the Greek bailout, the country was forecast to raise 50 billion euros by 2016, but the figure was later cut down to 15 billion euros. Now with just under 3 years to go, Athens has only managed to raise 5 billion euros.
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