(RTTNews) - The euro managed to steady on Tuesday, as Greek officials worked feverishly to secure the funds its needs to avoid defaulting on its sovereign debt.
It is feared that a Greek default will have a contagion effect on the wider euro zone, putting pressure on Greece's neighbors to follow through with bailout funds.
However, Greece has failed to meet the conditions of its loans from the euro zone and International Monetary Fund, and muist still make drastic budget cuts in the face of popular unrest in Athens.
To complicate matters, Italy was downgraded by S&P late last night. THe ratings agency cited Italy's dire growth prospects and political gridlock in taking the nation's credit rating down one notch.
Still, the euro rallied to CHF 1.2125 versus the Swiss franc, breaking out of the narrow range it has been stuck in since the Swiss National Bank pegged the franc to the euro at 1.20 a few weeks ago.
Today, Swiss authorities vowed to defend with "utmost determination" its cap on the franc's exchange rate.
The euro was firm at $1.37 versus the dollar, ahead of tomorrow's nterest rate news from the U.S.
The Federal Reserve makes its latest monetary policy announcement on Wednesday, after a two-day meeting this kicks off in Washington this morning. Traders expect Ben Bernanke and company to shift into longer-term treasuries instead of announcing a third round of quantatitive easing.
New U.S. residential construction fell by more than expected in August, according to figures released by the Commerce Department on Tuesday, although a higher than expected level of new building permits shows some hope for the beleaguered construction industry.
It is feared that a Greek default will have a contagion effect on the wider euro zone, putting pressure on Greece's neighbors to follow through with bailout funds.
However, Greece has failed to meet the conditions of its loans from the euro zone and International Monetary Fund, and muist still make drastic budget cuts in the face of popular unrest in Athens.
To complicate matters, Italy was downgraded by S&P late last night. THe ratings agency cited Italy's dire growth prospects and political gridlock in taking the nation's credit rating down one notch.
Still, the euro rallied to CHF 1.2125 versus the Swiss franc, breaking out of the narrow range it has been stuck in since the Swiss National Bank pegged the franc to the euro at 1.20 a few weeks ago.
Today, Swiss authorities vowed to defend with "utmost determination" its cap on the franc's exchange rate.
The euro was firm at $1.37 versus the dollar, ahead of tomorrow's nterest rate news from the U.S.
The Federal Reserve makes its latest monetary policy announcement on Wednesday, after a two-day meeting this kicks off in Washington this morning. Traders expect Ben Bernanke and company to shift into longer-term treasuries instead of announcing a third round of quantatitive easing.
New U.S. residential construction fell by more than expected in August, according to figures released by the Commerce Department on Tuesday, although a higher than expected level of new building permits shows some hope for the beleaguered construction industry.
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