Euro fluctuation is 'merely a holiday trend'

The euro today grew by 10 bani from yesterday to 15.58 lei and experts attribute this fluctuation to a trend appearing around holidays such as the Easter season. Dr. Sveatoslav Mihalache, director of the counseling firm Financial Brains Moldova, explained: “During the holidays, the euro depreciated because many people converted euros into lei. But now the euro rate is back to normal. It's merely a holiday trend”. However, the euro faces risks in Europe, as Mihalache notes that the situation on the credit markets is “very tense” with the interest rates on the Spanish and Italian bonds continuing to grow. “The euro is balancing on the edge, demonstrating a remarkable resistance. The macroeconomic data in recent weeks continue to disappoint investors. Adding to the negative economical data is the political incertitude around the presidential runoff in France, elections in Greece and potential elections in the Netherlands”, said Mihalache. Mihalache recommends to pay attention to the levels $1.3000 and $1.2975 in the EUR/USD pair, as the penetration of these levels would open the door towards the $1.26 level, the year's low, which would translate to 14.80-90 in lei. Mihalache suggests that the euro's fall will be “disastrous” and imminent unless the European Central Bank adequately tackles the “Greek disease” and its reverberations in Spain and Italy by either purchasing Spanish and Italian bonds or initiating a new long-term refinancing round for the commercial banks in Europe. Otherwise, the director of Financial Brains Moldova suggests, “don't keep euros in your pockets”.