By: Barbara Zigah
The Euro continued its upward trend in Asian trading today, boosted by encouraging signs that the growing Ireland debt and deficit problem is nearing a resolution and the strong defense of the U.S.’s impending QE scheme by Ben Bernanke, the Chairman of the U.S. Federal Reserve Bank.
As reported at 1:14 p.m. (JST) in Tokyo, the Euro was trading steady against the U.S. Dollar at $1.3650; earlier this week, the Euro has briefly struck a 7-week low trading at $1.3446, but regained better than 1% since then. Resistance is pegged at $1.3750 - $1.3785, and traders say it needs to trade higher for solid confirmation of the downward trend. The Euro also moved higher against the Japanese Yen, trading at 114.00 Yen; on Tuesday, it has slipped as low as 112.23 Yen.
Analysts warn that the Euro is still under threat as the Irish government has not confirmed whether or not it will accept the rescue package, which could amount to as much as €90 billion. Currently, there remains a point of contention as regards the comparatively low corporate tax rate charged by Ireland. Peripheral Eurozone countries have long condemned that low rate and insist that Ireland hike it if it wants the rescue package.