Discussions about the Greek debt are still dominating on the European market. The single currency gained slightly against the British Pound the UK and seems to remain at this level. There are minimal economic announcements from Europe today as the market attention is currently concentrated at the US Dollar.

The Euro is trading at £0.8378 at the moment and still moving upwards.

GBP/EUR     €1.1944

Things are quiet for the Pound today as the attention is concentrated towards the US Dollar. The Pound however is still struggling against the Euro. It’s currently downgrading against the single currency and trading at €1.1944.

EUR/USD     $1.3114

The Euro today is gaining strength against the Dollar as the greenback is falling due to announcement from the Federal Reserve that the rates will remain quite low for a long period of time. The gains are, however, still considered temporary.

The Euro is currently trading at $1.3114.

USD/EUR     €0.7624

The focus today shifted towards the US Dollar. The greenback downgraded against most of its counterparts in an overnight trade as a result of dovish Federal Reserve policy announcement that the interest rates would stay at extremely low levels for at least two more years. Unemployment is at high priority at the moment as it’s still higher than it should.

The US Dollar continues to fall against the Euro and trading at €0.7624.

In general, the Euro is falling as concerns over the debt crisis are still present and also as the euro zone finance ministers rejected a restructuring plan on the Greek debt by creditors.

However, it is outperforming the Pound, and currently upgrading against the sterling as it’s trading at £0.8385.

GBP/EUR     €1.1921

The Pound was the worst performing currency in the last 24-hour period, as even the Euro outperformed the sterling.  It is still downgrading against the Euro and currently trading at €1.1921.

EUR/USD     $1.3043

After three-weeks high, the Euro downgraded against the US dollar after the euro zone finance ministers rejected an offer by private creditors to restructure Greek debt.

At the moment, it’s slightly gaining strength against the dollar as it’s currently trading at $1.3043.

USD/EUR     €0.7671

The US Dollar upgraded overnight against its major counterparts. Traders expect the annual inflation rate to drop in the fourth quarter, which may suggest decreased interest rates.

It is slightly downgrading against the Euro at the moment, trading at €0.7671.

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The pair EUR/GBP is quite unstable at the moment. Right now, the Euro is gaining strength and is trading at £0.8274.

GBP/EUR     €1.2082

The Pound was said to be the worst performing currency last week. However, it has a great advantage ahead of its counterparts, which is that the UK is not a member of the Euro Zone. Such independence allows the country to control its own monetary policy, and is more flexible when it comes to shifts in market trends that are deepening the Euro crisis.

Still, the UK does not remain completely untouched by the overall economic situation in Europe. Low growth and high unemployment still exists. Labour market data will be released on Thursday, and the unemployment rate is said to remain at the current rate of 8.3 per cent.

The Pound is currently trading at €1.2082.

EUR/USD     $1.2662

This week euro zone ratings downgrades are unlikely to shake up investors. What could change the Euro shift, however, is the Greek debt talks which would block any optimism in the future of the single currency.

“The euro zone crisis is now dominating market activity again, after a period in which better economic news from the U.S., and easier monetary policy in China had helped markets move higher,” said Dominic Rossi, chief investment officer at Fidelity Worldwide Investment.

The Euro is downgrading against the Dollar today as it’s trading at $1.2662 at the moment, which is a fall of -0.17%.

USD/EUR     €0.7900

The US Dollar is well-positioned at the moment, and any shift would be a result of the European debt crisis. It’s currently growing against the Euro and is trading at €0.7900.

The markets today eagerly anticipate the meeting between the German Chancellor Angela Merkel and the French President Nicolas Sarkozy during which they will work on the “fiscal compact”. The meeting is to prepare the EU summit scheduled for January 30^th which shall reveal ways to boost the EU economic growth. Before the meeting even takes place, the Euro demonstrated gains against the Dollar as it climbed up to $1.2761. Yet, however, further declines are expected as investors are still concerned over the debt crisis.

Despite today’s growth of the Euro, the US Dollar has been gaining lead against the single currency especially since last week the US jobs data was unexpectedly high. The US jobs data also emphasized the growing difference between the United States and Europe which inevitably means weaker EUR/USD pair. Experts say the United States is on its way out of the economic crisis, supporting the statement that “Outside Europe the world looks better – but not great.”

At the same time, the outlook for Europe in 2012 is hardly defined as bright or hopeless, although the biggest fear is from Euro collapse and thus – full blown recession in the euro zone.

EUR/USD  $1.2751

Consumer debt is increasing steadily in the U.K as the country attempts to combat ec

onomic contraction. The austere fiscal measures implemented by the government have failed to produce any significa

nt result till now. A survey by KPMG, a renowned accounting firm, reveals that almost 45,000 people resorted to IVA in 2010 in order to wipe out their debts. Bryan Jackson, an executive of PFK international, says that the figure is supposed to increase in the years to come because of the long term effect of the global economic meltdown. Statistics provided by the department of Trade and Industry one in five adults in the U.K has debt amounting to £10,000 or more. Incredible isn’t it? Under the circumstance, a huge n

umber of debt stricken people in the U.K are looking for debt relief options. However, many debtors get confused when it comes to choosing between IVA and bankruptcy. Which is the better option for you?

IVA: an overview

IVA or Individual voluntary arrangement was introduced almost 20 years back to provide the consumers a better alternative to bankruptcy. With IVA, a debtor can contact his creditors for settlement of debt. This is a legally binding agreement on both parties. In most cases, people who opt for IVA owe more than £52,000 to his creditors. You should understand that IVA deals mostly with unsecured debts like credit card debt and setting up an IVA will cost you anywhere between £7,000 and £10,000. The minimum monthly payment in case of an IVA is usually £200.

You would need to approach the creditors through an insolvency practitioner. If the terms and conditions of your proposal are accepted by more than 75% of the creditors then all of them will be bound to accept the offer. Creditors can also suggest changes to the agreement but they can’t force you to accept it. It is possible to stop all the interests on your debts through an IVA.

You would need to make the payments to the insolvency practitioner and once the all the payments are made, the remaining debt is written off. If you regularly miss payments then the creditors can force bankruptcy on you.

Bankruptcy-a costly way to eliminate debt

Bankruptcy is another option for people who are knee deep in debt. With bankruptcy, your assets are liquidated in order to pay off the debts. Some assets like pensions, jewelry, household items etc are considered as exempt. Within a year, bankruptcy will eliminate your debts and allow you to start fresh but the effects of this debt relief program will linger for a long time.

IVA vs. Bankruptcy: what’s the right choice for you

Bankruptcy might be the right option for you only if you don’t have any important assets to lose. In other cases, an IVA is possibly the better solution due to the following reasons:

1)    An IVA does not involve lengthy court procedures which are unavoidable in case of bankruptcy.

2)    You would be able to save important assets with the help of an IVA.

3)    Bankruptcy may cause problems in case of future employments but there is no such issue in case of an IVA.

4)    Bankruptcy may cause you social and economic embarrassment but IVA will not.

5)    An IVA will not damage your credit history as much as bankruptcy.

The insolvency options like bankruptcy and IVA are not easy on the debtors. If you need to choose to one of them then IVA is possibly the better option because of the above mentioned reasons. However, if your financial situation is truly acute then opt for bankruptcy because falling behind payments while in IVA will eventually make you bankrupt anyway.

The contraction is visible mostly in the construction industry where the activity has declined by more than 3% in the last three months of 2010. It was expected that with the fall, retail sales would take a hit but the blow to the construction industry came as a surprise. The manufacturing industry remains the sole ray of hope with a growth rate of 1.4%.

The government has made it clear that change in fiscal policies is not on the cards. Quoting ONS, the government sources said that the contraction was caused exclusively by the horrible weather. They further added that the current fiscal policies have gained Britain credibility at the international level and helped the country to combat economic crisis. Quite clearly, the government refuses to back off just on the basis of a quarter’s performance.

However, the Governor of Bank of England along with other economists, contradict the above statements. They argue that though the economy was growing till the middle of the year, things have changed since then. Inflation is shooting up, unemployment and consumer debt is on the rise and people are opting for debt management programs. Though the government claims that the economy is back to its feet, the real story is something different. Questions are being raised about the efficiency of the government’s deficit reduction program. The UK government is highlighting the fact that public sector borrowing has been significantly less in December (£16.8bn). But the Chamber of Commerce believes that the current figure is still way too high.

The contraction also reflects the dilemma which the Bank of England is currently experiencing. It needs to raise the interest rate to curb inflation but is hesitating to do so as the question of the UK’s economic recovery is not yet settled. Noted economists like David Kern opine that the interest rate should be raised only when the economy becomes more stable. They also suggest that the government should clear all impediments which might stop the corporate houses from creating job opportunities or discourage them from investment.

The contraction of the U.S economy has made everyone apprehensive. On top of that, GDP figures confirm that Britain’s economy is still vulnerable. With the government emphasizing on fiscal austerity, we should expect a tough time ahead of us.

Due to worries about the cost of protection against the government debt in Ireland and Portugal, the euro fell to 1.3775 dollars.

The G20 summit of advanced and developing economies is still maintaining a high level of currency tensions.

In contrast, the dollar rose to its highest levels since late October against major currencies.

According to traders, the market will observe an auction for long-dated Treasury bonds later today, which they expect, will give clues to the direction of the dollar.

EUR/GBP

Good figures such as the NIESR GDP estimate came out today, which continue to support the positive sentiment for the sterling. The figures suggest that the recession is over and that additional quantitative easing is not necessary to ensure recovery.

The euro continues to be suppressed as fear of euro zone debt is still at stake.

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Last week the Irish government released a plan to cut spending and raise taxes by 6 billion euros in 2011.

Due to concerns over the Ireland’s budget deficit, the euro fell for a second day versus the dollar. In fact, the single currency weakened versus 13 of its 16 opponents. The arrival of the EU Economic and Monetary Affairs Commissioner Olli Rehn in Ireland is highly anticipated as he is coming to discuss the spending cuts and tax increases in the country.

EUR/GBP

No major events are expected for the euro versus sterling this week.

GBP/USD

This week, a wide variety of events will occur which will seriously affect the British pound, as the inflation report will be of the highest impact. Financial experts remain rather neutral on the pair due to the British figures being quite mixed recently.

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The euro is said to benefit from a “currency war,” in which many countries step in to keep their currencies weak, and thus to protect exports.

“The euro is one of few major currencies where there are no deliberate measures to try to weaken the currency, either directly through intervention or indirectly through QE (quantitative easing),” said Micheal Derks, currency strategist at FXPro.

Steve Barrow, head of G10 currency research at Standard Bank, predicts the euro will rise to $1.45 in three months, even if the Federal Reserve insists on a small dose of quantitative easing.

Overall, the euro looks healthy, growing against the dollar from the beginning of the week, and currently trading at $1.4034.

EUR/GBP

The euro rose 1% versus sterling yesterday, as a result of demand from a European sovereign account and sterling being under pressure due to weak UK construction activity data.

The euro rose to 0.8734 pounds so far, compensating for the losses on Monday when it fell to a four-week low of 0.8651.

According to traders, the European sovereign account was a large buyer of euro/sterling at the moment.

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The pair continued falling at the beginning of the week, dropping below 1.3830. It then recovered and managed to reach the current 1.3977.

The quantitative easing program in the US caused the vulnerability of the EUR/USD, as it is said to exceed $500 billion. In addition, the USD is speculated to drop this week. The pair is, however, supposed to calm down by the end of this week.

The GBP/USD made a gradual and choppy climb up last week, and managed to end at 1.6037. The current price is the same so far.

The good GDP number and the close above 1.60 are positive signs. Despite that, and the fact that employment is on the rise, the situation in Britain is still not that good. More quantitative easing is expected, too. Economists remain neutral on the pair, at the moment.