The Euro weakened against the majority of its counterparts after Greece’s government coalition failed to come up with the answer for reducing 11.5 billion Euros in spending. This ebbed optimism in the trading markets, especially as Germany indicated that on Wednesday, a Court will rule on the constitutionality of the region’s permanent bailout. The Euro slipped against the U.S. Dollar for the first time in close to one week, as market investors believe the Euro region hasn’t shown proper signs that it can manage its ongoing debt crisis.
China reported the first decline in imports since January, thereby prompting the Australian Dollar to fall on signs that major global economies are slowing down. According to the official numbers, China’s imports dipped 2.6%. The Aussie remained under pressure as other metrics confirmed that home loan approvals plunged 1% in July.
News from Japan indicated that Gross Domestic Product expanded at an annualized 0.7% in the second quarter, suggesting the economy grew less than economists predicted. This further dampened risk appetite,
Other Forex system publications showed that the Canadian Dollar reached a one-year high against the U.S. currency on speculation the Federal Reserve will announce a third round of quantitative easing this week, given the recently disappointing flurry of economic data. The Loonie rose against most of its Forex exchange peers as the market was still reacting to last week’s statement by the Bank of Canada’s Governor, Mark Carney, suggesting that the central bank may be considering a hike in interest rates.