Tuesday, May 04, 2010

No Greek Tragedy for the Mighty Dollar

From CNNMoney.com:

Now that Greece has finally gotten its bailout, are the days of the strengthening dollar over?

The greenback has gained about 8% against the euro so far this year. Many experts said a lot of this rally had to do with the notion that the dollar was now a much safer haven than the euro in light of the debt problems facing Greece, which is one of the nations that use the euro currency.

So it would be reasonable to think that the euro may finally get back on solid footing. Not so fast.

The dollar gained more ground against the euro Monday morning, the first day after the $146 billion Greek bailout was announced. And the dollar's strong run may not be over yet.

After all, even though it looks like Greece may be able to avoid actually defaulting on its debt; it's not as if the country is now fiscally fit. Plus, the bailout news was not a surprise. There's been speculation about an IMF/EU deal for months.

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