Euro Firms Against U.S. Dollar as Greece Adopts Austerity Plan

The euro is firming in forex trading against the U.S. dollar this morning as Greece announces an austerity plan. The announcement of a plan comes despite concerns by the Greek populace with regard to austerity measures.

However, the euro's advance in currency trading has been capped somewhat by the nature of reality. GFT's Boris Schlossberg reports in FX360 on the uncertainty that still surrounds Greek attempts to reign in finances:

At first glance, the Greek plan appears to have made serious progress in addressing the fiscal budget deficit problems that have wreaked havoc on its capital markets since the start of the year and is likely to assuage the ratings agencies who have threatened to down grade Greek government debt below investment grade. However, Greek fiscal officials will still require support from EZ two most powerful members – Germany and France – in order to access debt markets on favorable terms.

With Greece unable to get out of this mess on its own, and with European countries and banks still exposed to Greek debt, it is little surprise that the euro could remain volatile for a while.