Euro climbs against dollar as ECB prepares loans

Posted On: February 28, 2012
The value of the common currency of the European Union pushed toward its top rate in 90 days against the world's reserve currency on Tuesday, according to Bloomberg.

The European Central Bank was preparing to avail three-year loans on Wednesday as a strategy of enhancing regional banks' liquidity, the anticipation of which served as a driver. The euro rose to its top amount against the U.S. dollar since early December.

"In the short term, the LTRO operation should be risk- and euro-supportive," currency strategy head Jeremy Stretch wtih Canadian Imperial Bank of Commerce in London told Bloomberg. "The liquidity that the operations have injected into the market has reduced some of the solvency fears, particularly in the European banking market, and that's provided a much better risk environment."

A Bloomberg survey indicates the ECB is set to distribute roughly 470 billion euros in loan money, which follows the dispersal of 489 billion in euros in late December of last year.

Reuters reports some investors were concerned that the ECB program might be short lived.

Category: Industry News


Foreign Exchange Services for Business

With a focus on payment services, Western Union Business Solutions enables businesses of all sizes to send funds internationally through our global payment solutions.

See our available FX payment services