The Euro rallied against the U.S. Dollar after members of the German coalition headed by German Chancellor Angela Merkel indicated that they would not oppose the European Central Bank’s plan to purchase government bonds. Subsequent to the announcement, Spanish 10-year bond yields slipped below 7%.
The U.S. Dollar fell versus the majority of its online Forex peers on continued speculation that major global central banks may take added steps to bolster economic growth. The greenback declined on Friday after economic calendar reports showed the U.S. unemployment rate rose to 8.3%, increasing the likelihood that the Federal Reserve will announce another round of quantitative easing at the end of August. At this time Fed chairman Ben Bernanke is set to speak at a conference in Jackson Hole, Wyoming.
Other Forex trade news showed that the Australian Dollar rose versus its American counterpart on prospects the nation’s central bank won’t reduce the interest rate. The New Zealand Dollar also advanced versus the greenback after the S & P re-affirmed the country’s credit rating and stated that the “outlook is stable.”
The Canadian Dollar traded at parity with the U.S. currency for the first time since the month of May as crude oil, its biggest export, climbed following the release of U.S. payrolls which confirmed employers added more jobs than estimated in July. The Loonie advanced for a fourth week against the Euro and the greenback despite the fact that the central banks of the E.U. and the United States refrained from implementing further stimuli.