The Single Currency Fell on Tuesday as Slovak Parliament Rejected the Proposal for Bailout Fund

The single currency declined by the end of US session on Tuesday after a volatile day. Investors were uncertain for the euro after the Slovak parliament rejected the plan for extension of bailout funds of 440 billion euro equivalent to $600 billion. The rejection of the bailout program came in reaction to a no confidence vote by Slovak Parliament.

Global head of FX strategy at RBC Capital Markets commented, “Should the [Slovak] vote fail, it is highly likely to be followed by a second, successful vote and the rapid dissolution of parliament, this could happen within a matter of days. Euro weakness on an initial ‘no’ vote should therefore be faded.”

The euro declined to 1.3644 against the greenback on Tuesday as compared to 1.3670 on Monday’s North American trading session. The US dollar however also remained under pressure as the dollar index DXY which tracks the greenback’s movement against its six major counterpart currencies fell to 77.549 on Tuesday as compared to 77.581 on Monday’s late trading hours.

The euro was stronger in the start of the session after the announcement of European Union, International Monetary Fund and European Central Bank to release the first tranche of 8 billion euro equivalent to $10.9 billion to Greece in the start of November.

Among other currencies US dollar also fell versus the Japanese Yen to 76.67 on Tuesday as compare to 76.70 on late Monday while markets in Japan were closed on Monday in observance of the Sports Day.

However the greenback was up against the UK’s currency as the British Pound fell to 1.5602 on Tuesday as compared to 1.5671 on late Monday.

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