FOREX-Euro plumbs new depths on Swiss franc, Aussie

* Euro pinned near three-week lows on US$

* Rising stocks, commodities keep Aussie well bid

By Wayne Cole

SYDNEY, Dec 22 (BestGrowthStock) – The euro continued its slow
descent on Wednesday as a steady drip of grim ratings news
eroded confidence in the single currency, dragging it to
record lows on the Swiss franc and Australian dollar.

The latest blows came from Moody’s, which warned it might
cut Portugal, and Fitch, which did the same favour for Greece
[ID:nTOPNEWS].

“Though one might suppose that the market had become
somewhat desensitized to such news, evidence suggests
otherwise as periphery-bund spreads widen again and EUR
remains under pressure,” said David Watt, senior currency
strategist at RBC Dominion.

A dearth of liquidity and talk of bids from Asian central
banks helped limit the euro’s fall against the U.S. dollar to
a trough of $1.3073 and in early Asia the single currency had
steadied at $1.3097, right on its 200-day moving average.

But it fared less well against the safe-haven Swiss franc
and high-yielding Australian dollar.

“EUR/CHF is going deeper into uncharted territory having
broken 1.26, and continuing to dig deeper,” noted Watt, as the
euro slid to 1.2548 francs for a loss of almost 4
percent so far this month.

“From near A$2.0 in March 2009, EUR/AUD has been under
relentless downward pressure,” he added. “The recent move
suggest an acceleration to the downside, with 1.30 in focus.”

The euro was down at A$1.3126 after shedding
two cents in as many sessions. For the year, it is off 17
percent.

The Australian currency was underpinned by further gains
in equities and commodities which spoke of improving risk
appetite as analysts revised up forecasts for global growth in
2011.

The S&P 500 on Tuesday finally recovered all the
ground lost since the Lehman debacle, while the CRB
commodities index claimed a two-year peak.

All of which helped the Aussie up on the U.S. dollar to
$0.9981 , a gain of over 11 percent for the year.

The U.S. currency fared better on sterling, which took a
swipe from news of a record UK. borrowing requirement and
slipped to a near three-month low at $1.5463 .

The US dollar index (Read more about the global trade. ) was up a modest 0.07 pct at
80.687, which makes a gain of 3.6 percent for the year but
still leaves it far below the June peak of 88.708.

While the dollar has gained ground on the euro this year,
it has had no such luck on the yen being down almost 10 big
figures since the end of 2009. On Wednesday it was going
nowhere at 83.74 yen , sandwiched between bids under
83.50 and offers above 84.50.

Japanese trade figures due later Wednesday are expected
to show a pick up in exports for November, echoing strength
seen in other Asian exporters recently.

The UK and US release their latest estimates for gross
domestic product (GDP) for the third quarter. Growth in the
United States is likely to be revised up to an annualised 2.8
percent, from 2.5 percent previously.

More importantly, recent upbeat data on consumer spending
has led analysts to sharply lift forecasts for growth this
quarter, while the surprisingly aggressive package of tax cuts
agreed this month has boosted estimates for all of 2011.

(Editing by Narayanan Somasundaram)

FOREX-Euro plumbs new depths on Swiss franc, Aussie