Equity Gains Lift Australian Dollar and Euro in July

After weeks of bleak news for the euro, it finally registered a gain over the American dollar. The Australian dollar was another currency which registered a gain. The high-yielding Australian dollar rose to almost a two and a half month high figure. This was a result of the equity gains which increased the requirement of higher yielding and high risk currencies. In a market that has been dominated by the American dollar in the recent past, this was a welcome change.

USD Falls Against Other Currencies Also

An increase in the earnings in Europe, the United States of America and Asia contributed to the rise in the equities. This resulted in the United States dollar falling against a bunch of currencies to a 2-week low. The dollar index hit the 82.740 mark which made it look bleak indeed.

The Yen was the most dominant in the group of currencies against which the US dollar fell. The US$ recorded a 6-week low figure against the Yen. The reason behind this was the fact that investors were more inclined towards Japanese currency as there was a possible chance of more financial easing in the USA.

Euro Falls against the Yen and Australian Dollar

Even though the Euro gained against the American dollar, it fell against the Australian dollar and the Yen. While it fell a little against the Yen, there was a significant drop against the Australian dollar to a new record low figure. The Euro was considered a risky proposition till later in the day when Germany agreed to aid Spain.

There was a vote which ensured that Spanish banks would be injected with financial aid from Berlin. The funds are expected to be in the range of 2 to 3 billion Euros and the term for the loan might be between 3 and 7 years. The exact figures will be decided through an auction.

The Euro was at US$1.2296 which was an increase of 0.1 percent, after hitting a 1 week high figure of $1.2325. However, traders reported that there was a high demand for the currency to be sold at $1.2350. This could seriously limit the gains of Euro.