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DXY Index Retreats, Giving Gold the Upper Hand

SeekingAlpha |

In Brief...

The dollar weakened Thursday as the Irish debt situation became clearer, giving the euro a relief lift. Risk currencies bounced back nearly 1% yesterday on news that any bailout of the Irish credit markets would pinpoint the country's banks and not its sovereign debt. However, if the losses are limited to troubled local banks like AIB and IRE, the full-fledged moral hazard of saving a euro nation from its debt can be avoided.. In the current environment, the irony is that the euro has become the king of the risk currencies -- even though it represents one of the biggest economic zones out there and that at least in the core, national balance sheets are already clean and getting even cleaner all the time.. As a result, gold -- and bullion-backed ETF GLD climbed Thursday as well..

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