According to French President Francois Hollande the Euro crisis is over… even though unemployment is at record highs, growth is virtually nonexistent; manufacturing is in the doldrums and a debate being held in the German high court that could decide the fate of the troubled single currency.
“What you need to understand here in Japan is that the crisis in Europe is over, however, we must create a new outlook – an outlook for growth and employment.
‘Together with Germany, we are trying to establish new goals beyond fiscal discipline. France and Germany together are trying to address unemployment, particularly among the youth, in order to restore Europe’s competitiveness…
‘We must ensure that industries are not only hindered but become part of our long-term strategy.” Hollande said as he addressed an audience of business leaders in Japan on Saturday.
Wise words indeed… except for the first part. Data released today showed a further contraction of Italy’s economy and consumer confidence remains in negative territory in regard to the Euro-zone Sentix Investor Confidence. In short, Europe’s problems are far from over.
Worryingly for the Euro the German high court could force the region’s largest economy to leave the currency if it finds that the Euro-zones bailout policies breach the German constitution.
Udo di Fabio, the constitutional courts Euro expert until last year, said the explosive case on the legality of the European Monetary Union rescue machinery could provoke a showdown between Germany and the European Central Bank (ECB) and ultimately cause the collapse of monetary union.
The court case was launched after 37,000 German citizens launched a legal complaint who argued that the ECB has overstepped its mandate by financing the deficits of bankrupted states.
Berenberg Bank said the case was now “the most important event risk” looming over the Eurozone, with concerns mounting over an “awkward verdict” that may constrain or even block ECB action.
The case is expected to last for two days, with a ruling expected over the next few weeks. Although with so much on the line it is highly unlikely that MEP’s and German leaders would allow the court to end the Euro after all they have committed too much to the currency and the last thing politicians like to do is lose face.
Current Euro (EUR) Exchange Rates
The Euro/US Dollar Exchange Rate is currently in the region of: 1.3184
The Euro/Pound Sterling Exchange Rate is currently in the region of: 0.8501
The Euro/Australian Dollar Exchange Rate is currently in the region of: 1.4000
The Euro/ New Zealand Dollar Exchange Rate is currently in the region of: 1.6751
The US Dollar/Euro Exchange Rate is currently in the region of: 0.7563
The Pound Sterling /Euro Exchange Rate is currently in the region of: 1.1745
The Australian Dollar/Euro Exchange Rate is currently in the region of: 0.7129
The New Zealand Dollar/Euro Exchange Rate is currently in the region of: 0.5955
(Correct as of 14:35 pm GMT)