Euro retreated against the dollar on the forex market

The Euro retreated against the dollar still on the forex exchange market this afternoon, a sign that fears of sovereign spread of the crisis do not improve. At this time, the euro lost 0.16% against the dollar at 1.3504 dollar the euro. A low of 1.3429 was marked this morning.

Not much new in Europe, where the policy of the ECB’s sovereign debt and the means of EFSF leave investors in the dark. And after Italy, market attention is also focused on France.

“The spreads (spreads) between German and French rates to 10 years were at their highest level since the creation of the euro (at 190 basis points),” remind traders of Pictet & Cie about meeting yesterday. The widening gap in the performance of state funds equivalent in France and Germany reflects rising investor concerns about the financial situation not only of Italy but also France.

At this time, the 10-year Bund reported 1.78% and the equivalent French OAT 3.66%, a spread of 1.88 basis point. Little improvement to report in that direction.

The “10 years” of Spain and Italy are respectively more than 6.3% and 7%. No release of pressure on that side either. The euro also lost 0.58% against the yen to 103.7, 0.14% against the pound at 0.8542 and 0.16% against the Swiss franc to 1.2372.

Statistics on the agenda of the morning, it was reported that the inflation rate reached 3% in the euro area from a year earlier in October, a rate unchanged from September, according to figures released Wednesday by Eurostat . The Statistical Office of the European Union states that monthly rate, that is to say, a month to month, the monthly inflation rate in the 17 countries in the region stood at 0.3 % in October.

Wall Street Hit By Uncertain Eurozone

Wall Street has re-shifted sharply downward, while the operators were informed by a dispatch only after an extraordinary cabinet meeting, Papandreou confirmed his proposed referendum and still hoped obtain a vote of confidence of the Greek Parliament.

A high-risk gamble was considered with extreme severity by the markets as the “majority” which he believes may have already no longer exist. The latest rumors from Athens, at least three members of the ruling coalition could defection by Friday (confidence vote) instead of 153 votes, the first Greek Minister would have no more than 150 votes out of 300, an absolutely no flexibility.

Faced with the risk of Greece government by private 72H, which almost automatically lead to a failure (failure of the Brussels Agreement, the risk of contagion from the debt crisis in Italy).

It is almost certain that the IMF, Merkel, Sarkozy will try to dissuade Mr Papandreou to carry out its proposed referendum but the statement released tonight shows that he does not intend to backtrack and assume by advance the democratic rules that can lead to a resignation on the eve of ‘G-20′ (which would be a parting gift that the summit participants would turn to Cannes volntiers).

Wall Street tries to take stock of the enormous uncertainties facing the euro zone and this results in a surge in the VIX from 18% to 35.25 (a score of 25 against 48 hours earlier).

ECB Repurchasing Euros Bonds

Rising credit risk Italian referendum on Greece, relapse of the markets in the wake of financial stocks … The beginning of the week is feverish stock market, like the euro, which falls on Tuesday morning at 1.3815 / $. The European Central Bank announced it had bought about 4 billion euros of government bonds during the week ended October 28, slightly less than the amount of the previous week, which is still so … The ECB had indeed bought 4.5 billion euros of bonds during the week ended October 21.

Since the beginning of the “Securities Market Program” launched in May 2010, the ECB has repurchased 173.5 billion euros, against 169.5 billion euros a week earlier. Recall that the ECB reactivated on August 4 the bond buyback program, dormant since March, after a credit alert on Italy and Spain, while strongly attacked in the bond markets.

Moreover, the ECB would be reached Monday on the market to buy Italian and Spanish debt in the short term to counter the widening of their yield spread with German Bunds, some traders reported. The amount of bond purchases in Italy, however, was “limited”, while he was more aggressive on Spanish debt …

Greek side, Prime Minister Papandreou said on Monday night to organize a referendum on the European agreement reached last week on the back Greek and erasing more than half of the country’s debt. The referendum would be set up for the start of 2012. Previously, a vote of confidence on the same agreement “anti-crisis” will be held in Parliament in the coming days