Euro and Aussie bounce back

The euro regained some ground on Friday, but saw its gains limited on the back of a spate of surveys that revealed business activity in the eurozone was still weak.

The single currency climbed by 0.1 per cent to $1.2986, after falling to a low of $1.2920 on Thursday. Meanwhile, the Australia dollar went up by 0.3 per cent to $1.0468, and also rose versus the euro, with the common currency falling by 0.2 per cent to A$1.2401.

UBS FX strategist Gareth Berry said that its just a waiting game to see what will happen in Europe. He said that the two unanswered questions at present are where Spain will request help and Greece will receive sufficient time and money to ensure it has six months or so to work on solving its crisis.%
Negotiators talking about a bailout for Greece came closer to reaching an agreement on Thursday but remain some way off a deal which would mean Greece does not have to pay its next instalment of 31.5bn euros towards its bailout package.

In addition, many investors and traders are of the opinion that Spain is set to ask for help. If it does so, the European Central Bank’s bond-purchasing programme can begin, a move which would see the borrowing costs of struggling euro nations reduced.