Forex: EUR/USD rallies on EFSF news

FXStreet Team FXStreet

FXstreet.com (Barcelona) - Ahead of the US nonfarm payrolls, the EUR/USD was firm close to 1.2300 and then fell off on stronger than expected employment figures at +163K in July, strengthening the greenback. However, the retracement came soon after that, on news that EFSF wants repurchase facilities, unsecured and secured loan proposals from banks.

“Sounds like they want to lever-up”, wrote Jamie Coleman, analyst at Forexlive.com, adding: “If banks grant them repo facilities, they can lend their sovereign debt holds to banks in return for more cash…Rinse/repeat”.

The EUR/USD keeps rallying, now at 1.2325 high, as risk sentiment gets boosted. Peripheral yields are dropping.

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FXStreet Team

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