Sep 5, 2011
European banks are predicting the dollar and euro grim prospects
British investment bank Barclays Capital and one of the largest French banks, Societe Generale published their forecasts for growth in world currencies, according to which the U.S. dollar and the single European currency expected dismal prospects.
Analysts at Barclays Capital believe that the continued deterioration of macroeconomic indicators and a possible solution to the Central Bank of the United States continue its policy of quantitative easing may initially suppress cravings investors to take risks, but in future it should recover with the help of the Federal Reserve System.
In large firms, poor performance in the third quarter would mean that the so-called "safe currency" - the Japanese yen and Swiss franc - continue to strengthen against the dollar and the dollar, in turn, continues to fall against the euro and the pound sterling.
If in the coming weeks will improve the macroeconomic data, willingness to take risks will increase, and the goods and risk currencies will rise against the dollar, however the dollar could rise as against major world currencies.
In a study of Societe Generale said that the defeat of the party of German Chancellor Angela Merkel in regional elections last weekend made it clear that the preservation of the euro will be a difficult thing, because it is complicated by the opposition inside Germany.
Talks between Greece and the three international controls on the allocation of the next tranche of financial assistance should resume soon, but until then talk about the death of the euro area is inevitable - said Societe Generale.
Until now, the euro has been incredibly stable, but this week he will be tested and if they can not survive, then resume the dependence of European currency from the broader risk aversion by investors. If in the short term the euro will not be able to hold above 1.4109 dollars, the mood in world markets will fall much - the analysts said Societe Generale.