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Canada Goose Outlet LONDON, March 15 (Reuters) Zero interest rates, political risk and an Canada Goose Outlet uncertain future? The euro currency is holding up quite nicely for all that, with perhaps a little help from canadian goose jacket its near neighbours. Canada Goose Outlet

canada goose deals Widespread fears that 2017 packed European electoral calendar poses a threat to the single currency with rising support for eurosceptic populists across the continent appears to be having little direct impact on the currency itself. canada goose deals

canada goose clearance sale The European Central Bank euro exchange rate index is actually 0.3 percent stronger since the end of last cheap Canada Goose year. Only one of 50 trading days so far in 2017 has seen a move in that index of more than 1 percent and that was a gain. elections last November a swing of less than 2 percent either side of $1.06 for over four months now. canada goose clearance sale

canada goose clearance Even readings of implied volatility on a 3 month horizon, derived from the options market, remain subdued below 10 percent almost half the seismic readings seen at the peak of euro debt crisis in 2011. canada goose clearance

canadian goose jacket Deeper in, a long standing price premium on options to sell euros had been climbing through January and February. But that too reversed over the last three weeks and has returned to end 2016 levels. canadian goose jacket

canada goose black friday sale Could it be that no one in the currency market is bothered by the anti euro ire of increasingly popular far right leaders such as France Marine Le Pen or Geert Wilders in The Canada Goose online Netherlands? Is everyone Canada Goose Jackets really relaxed about German elections that could unseat Chancellor Angela Merkel or the prospect of snap elections in Italy this summer? canada goose black friday sale

Well, buy canada goose jacket cheap not so. Commodity Futures Trading Commission gives a snapshot of speculative thinking at least. It shows the largest net canada goose black friday https://www.canadagooseoutletstore.co.uk sale short positions against canada goose the euro last week since early January.

canada goose store Politics aside, it also not hard Canada Goose Coats On Sale to see a negative tilt toward the euro with the widest 2 year interest rate gap in uk canada goose favour of dollars in the canada goose store life of the single currency and monetary policy diverging. canada goose store

Debt markets have registered the political anxiety more clearly. Ten year French sovereign debt spreads over Germany while still well below the peaks of 2011 have doubled over the past four months to more than 60 basis points.

canada goose coats So what is holding up the euro so effectively? canada goose coats

STANCHING THE FLOW The most fundamental explanation is the ballooning of the euro zone current account surplus over the past five years to now register net monthly inflows over outflows in excess of 30 billion euros. It is a substantial natural support averaging a billion euros per day compared with external accounts that were just about in balance during canada goose clearance sale the blowout in 2011.

buy canada goose jacket cheap Relatively weak domestic demand for imports and strong German exports partly explain that surplus. But so too does euro zone governments now paying near zero or even negative returns to foreigners holding their bonds while euro area investors suck in canada goose uk shop much higher returns from equivalent canada goose clearance holdings abroad. buy canada goose jacket cheap

buy canada goose jacket The stable exchange rate suggests any capital seeping out the bloc for political or relative interest rate reasons can have exceeded that surplus drawing inflows against it. buy canada goose jacket

cheap Canada Goose Partly responsible for the seeming disconnect is a tendency for big overseas debt investors to switch within the euro area rather than flee it altogether as seen with reports that Japanese investors dumped French government bonds in recent months but bought twice as many German bunds. cheap Canada Goose

Canada Goose sale But Canada Goose Online the other tourniquet limiting the outflow has been the behaviour of two giant marginal buyers canada goose uk outlet of euros the Swiss National Bank and its Czech counterpart. Canada Goose sale

Canada Goose Jackets Although the canada goose factory sale SNB technically abandoned its fixed cap on the franc against the euro in 2015, it continues to amass vast stores of euros via ad hoc intervention to prevent excessive franc strength. Now in excess of 600 billion euros, Swiss foreign reserves have canadagooseoutletstore increased by more than a uk canada goose outlet hundred billion euros, or more than 20 percent, over the past 14 months alone. Canada Goose Jackets

Canada Goose Parka And even though it committed to abandoning it this year, the Czech central bank self imposed, three year old cap on the crown has seen it balloon its foreign currency reserves by 46 billion euros, or by 80 percent, since the start of last year to more than 100 billion euros last month. buy canada goose jacket That some 60 percent of Czech gross cheap canada goose uk domestic product. Canada Goose Parka

canada goose coats on sale Taken together, the two central banks have averaged monthly accumulation of close to 13 billion euros. About half that is banked in euro debt markets, a significant marginal offset to capital flows from the zone. canada goose coats on sale

canada goose Capital flight could ultimately canada goose coats weaken the euro but the scale of that movement now clearly has Canada Goose sale to be huge to have a durable impact on the canada goose uk black friday exchange rate. (Editing by Jeremy Gaunt) canada goose.

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