Greece struggles to escape downward spiral

Tuesday, 10 May 2011 12:25

Headlines has been covered with 'Greece' this past week as news of ridding the Euro and downgrade have been surfacing.  In yesterday's announcements Standard and Poor downgraded Greece from BB- to B while Moody's is threatening to also downgrade the country in the near future. 

Earlier these days Greece has been speculating about dropping the European currency and returning back to its old currency, the Greek Drachma, which shook the EUR to fall against major currencies such as the Dollar and Yen.  EUR/USD is trading at a steady pace of 1.4363 after falling to1.4284 (close to a seven week low of 1.4254) due to Greece's soundings of a bailout package, its second so far.  The EUR/JPY also fell to its lowest price since March at 115.07, while currently trading at 115.97.

Reports have been coming out that Greece will receive another bailout package of 60 billion euros by next month, but the Greek government has yet to confirm this. 

Analysts comment that the euro is not likely to fall into a dismal downward spiral as had happened when Greece suffered a serious debt crisis a year ago.