* Euro gets lift from report China will buy Portguese debt
* Euro hovers near all time low vs Swiss franc
* Rising stocks, commodities keep Aussie well-bid
(Recasts, adds quote, details)
By Anirban Nag
LONDON, Dec 22 (Reuters) - The euro gained against the dollar and recovered from all-time lows against the Swiss franc on Wednesday, boosted by a news report that China was ready to buy significant amounts of Portuguese sovereign debt.
The Jornal de Negocios daily reported China is looking to buy between 4 billion euros ($5.26 billion) and 5 billion euros of Portuguese sovereign debt to help the country ward off pressure in debt markets, though it gave no details of its sources. [ID:nLDE6BL0MW].
China's central bank declined to comment on the report which said the deal reached between the two governments will lead to China buying Portuguese debt in auctions or in the secondary markets during the first quarter of 2011.
"This is a small positive for the euro," said Valentin Marinov, currency strategist at CitiFX.
"The net supply in the first quarter is projected to reach 6 billion euros. If that is confirmed and China is willing to buy 4-5 billion euros it will reduce some of the funding pressures on Portugal."
The euro was up 0.5 percent against the dollar at $1.3160 EUR=, having hit a session high of $1.3181 on the news and well above its near three-week trough of $1.3073 set on Tuesday.
Despite the bounce, investors are nervous about the single currency's prospects given the euro zone's debt problems.
Latest blows this week to the 16-member club's struggling, heavily-indebted economies have came from Moody's, which warned it might cut Portugal's rating, and Fitch, which said the same about Greece. [ID:nTOPNEWS]
"The rating agencies are not saying anything new but the question is how does this market want to take it," said Geoffrey Yu, currency strategist at UBS. "Clearly these are terrible market conditions and the speed at which the euro is losing ground against the Swiss franc is a bit disconcerting."
The euro EURCHF= was down 0.1 percent at 1.2525 Swiss francs, having fallen to an all time low of 1.2493 on trading platform EBS. It took out option barriers at 1.2500 francs en-route to a fresh all-time lows, traders said.
It also fared badly against the high-yielding Australian dollar, EURAUD=R, falling to a low just under A$1.3100.
This entry passed through the Full-Text RSS service — if this is your content and you're reading it on someone else's site, please read our FAQ page at fivefilters.org/content-only/faq.php
Five Filters featured site: So, Why is Wikileaks a Good Thing Again?.
No comments:
Post a Comment