By FX Empire.com
The franc returned to its weak status on Tuesday after investors locked on profits with the beginning of the week and supported the weak franc which is still avoided due to the SNB vigilance and readiness to act against the currency’s appreciation.
We saw the gains spread for the euro most of the European session despite the overall jitters on the Slovak parliament vote on the EFSF expanded powers. The fear that Slovakia might reject the new EFSF powers pressured the euro yet did not halt its gains versus the franc.
Investors still see progress in the euro area especially after the troika said that Greece is likely to receive the next tranche of last year’s bailout by the beginning of November easing the fear of default and the block of the aid loans. Still the debate is ongoing on the how to contain the crisis especially as the EU bought more time by delaying the summit from next Monday till October 23 to assess the report from the troika on the progress in Greece and finalize their view on the new bailout that still sees mixed views over the increasing the private sector’s participation.
We still see the debt debate predominant and will control the pair on Wednesday especially as investors await the final vote from Slovakia.
The euro area is set to release the Industrial Production for August at 09:00 GMT which is expected with 0.7% drop after 1.0% rise and to rise 2.2% on the year following 4.2% rise.
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