How will the defeat of the Constitution effect the Euro?

[ATFFL]

With the EU Constitution going down in France, how will this impact the Euro?  It has been declining for a while now due to, in part, the anticipation of a French rejection.  Now that said rejection is a reality will the Euro continue its decline or has the defeat already been built in to the exchange rate and will it stabilize?

I expect the Euro to have a brutal time for the next few weeks.  There really is no good news coming up for the EU anytime soon.

[ragnar]

With the EU Constitution going down in France, how will this impact the Euro?  It has been declining for a while now due to, in part, the anticipation of a French rejection.  Now that said rejection is a reality will the Euro continue its decline or has the defeat already been built in to the exchange rate and will it stabilize?

I expect the Euro to have a brutal time for the next few weeks.  There really is no good news coming up for the EU anytime soon.

The effect on the Euro will be small.
Just because the constitution don´t become acknowledge, it does not mean that the EU will break down, it will survive.

[Beet]

The euro will stay high because the ECB's interest rates are scandalously high for some reason. If the French are angry at unemployment and slow growth, there is a bank they can point their finger to with good justice-- the ECB. In no other country except Japan would allow high interest rates, for no apparent reason be tolerated when unemployment is such a paramount issue. It is as if the ECB is deliberately trying to squeeze EU economies.

[bullmoose88]

The euro will stay high because the ECB's interest rates are scandalously high for some reason. If the French are angry at unemployment and slow growth, there is a bank they can point their finger to with good justice-- the ECB. In no other country except Japan would allow high interest rates, for no apparent reason be tolerated when unemployment is such a paramount issue. It is as if the ECB is deliberately trying to squeeze EU economies.

I believe Frankfurt's sole objective is to control inflation and will only change monetary policy to keep inflation between 1 and 3 percent...I think the Bank of Canada does the same thing...

Whether thats a good thing or not well...is debatable... but if I recall correctly (I might be wrong)...thats their MO.

[ATFFL]

Yes, I dabble on the markets.  Did well betting against the Euro in the run up to the French vote.

The Euro did poorly today. I expect it to go down tomorrow before the US starts releasing economic data all week long.  Big week.

[Angel of Death]

Isn't this actually good news as the high euro was hurting European export?

[bullmoose88]

Isn't this actually good news as the high euro was hurting European export?

If the Euro continues to decline (or at least not rebound), yeah...but woe to those holding European bonds...

[ATFFL]

One of the monetary aims of the EU is to have the Euro replace the US Dollar as the currency of international commerce.  To do this they want to make it seem strong and secure.