- EUR/USD has popped higher in the open and eyes 1.0700.
- UBS is said to take over Credit Suisse in a deal aimed at stemming what was fast becoming a global crisis of confidence.
EUR/USD has started out the day on the bid following the news that Switzerland's UBS has reached a deal to buy struggling rival Credit Suisse after an intense weekend of negotiations. EUR/USD is up 0.2% at the start of trade, reaching a high of 1.0689.
The 50 bps move from the European Central Bank on March 16 was accompanied by a risk-on the environment which has been weighing on the US Dollar as investors see the light at the end of the tunnel with respect to the banking crisis. Credit Suisse's chief executive said on Friday the bank was working hard to stem customer outflows and on Sunday UBS is said to take over Credit Suisse in a deal aimed at stemming what was fast becoming a global crisis of confidence.
Credit Suisse, the 167-year-old embattled lender had been brought to the brink of financial calamity last week, despite securing a $54bn (£44bn) credit line from Switzerland's central bank. Meanwhile, European Central Bank (ECB) supervisors do not expect contagion for euro zone banks from the market turmoil, a source familiar with the content of an ad hoc supervisory board meeting this week told Reuters.
´´In our view prevailing uncertainties suggest that USD strength is unlikely to fade too much in the weeks ahead. We have not (yet) made any adjustments to our EUR/USD forecasts due to recent market events,´´ analysts at Rabobank said. ´´We are forecasting EUR/USD at 1.06 on a 1 month and 1.05 in 3 months. We continue to expect the USD to give up some ground later in the year.´´
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
AUD/USD: Extra gains in the pipeline above 0.6520
AUD/USD partially reversed Tuesday’s strong pullback and regained the 0.6500 barrier and beyond in response to the sharp post-FOMC pullback in the Greenback on Wednesday.
EUR/USD jitters post-Fed with NFP Friday over the horizon
EUR/USD cycled familiar territory on Wednesday after the US Federal Reserve held rates as many investors had expected. However, market participants were hoping for further signs of impending rate cuts from the US central bank.
Gold prices skyrocketed as Powell’s words boosted the yellow metal
Gold prices rallied sharply above the $2,300 milestone on Wednesday after the Federal Reserve kept rates unchanged while announcing that it would diminish the pace of the balance sheet reduction.
Ethereum plunges outside key range briefly as US Dollar Index gains strength
Institutional whales appear to be dumping Ethereum after recent dip. Fed’s decision to leave rates unchanged appears to have helped ETH's price recover slightly. SEC Chair Gensler has misled Congress, considering recent revelations from Consensys suit, says Congressman McHenry.
The FOMC whipsaw and more Yen intervention in focus
Market participants clung to every word uttered by Chair Powell as risk assets whipped around in a frenetic fashion during the afternoon US trading session.