€ The euro depreciated vis-à-vis the U.S. dollar today as the single currency tested bids around the US$ 1.2250 level and was capped around the $1.2355 level. European sovereign debt concerns were back at the forefront today and these led to a weaker common currency. European Union Economic and Monetary Affairs Commissioner Rehn reported "Contrary to what some people argue, Europe is not suffocating growth by this strategy of fiscal consolidation. What we are doing is putting our fiscal houses in order in a gradual, differentiated way: faster where the doubts about fiscal sustainability have been biggest, and slower elsewhere." There is talk that the U.S. and Europe are at odds over a coordinated economic policy. The former is said to favour higher levels of deficit spending to stimulate economic growth while the latter is said to support reduced fiscal spending and would be comfortable with reduced economic output. The European Union is currently evaluating sanctions for "inadequate debt trajectory" and may consider a tax on bond issues by highly-indebted countries. Eurogroup Chairman Juncker reported the economic recovery "remains fragile and loaded with risks." The common currency's standing in many central banks' reserve portfolios is diminishing, a reflection of the currency's recent volatility and the eurozone's significant debt woes. German Chancellor Merkel reiterested Germany wants a stable euro and an independent European Central Bank. European Central Bank member Ordonez said Bank of Spain will publish banks' stress test results as soon as possible. Data released in the eurozone today saw the EMU-16 April current account print at -€5.1 billion, down from the revised prior reading of +€1.5 billion, while EMU-16 June consumer confidence improved to -17. German data saw the June Ifo business climate indicator improve to 101.8 while the expectations sub-index receded to 1 [...]
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