Yesterday afternoon, the euro spiked at around 3:00 pm EST, which was when the Guardian reported that German and French leaders had agreed on a plan for a 2 trillion euro ‘bazooka’ for dealing with the eurozone debt crisis. However, the euro quickly corrected when Dow Jones refuted the rumour.
So, who’s right?
Perhaps it’s just a bias for optimism. But if you look at the euro’s performance since yesterday afternoon, currency traders seem to be betting on the Guardian’s story. Euro bulls have also shrugged off Moody’s downgrade of Spain.
In other rumours, Reuters is reporting that the Swiss National Bank may move its Swiss franc cap against the in a way that could be bullish for the euro.
Here’s a chart of the euro against the dollar since 2:00 pm EST yesterday.