Big Gap Down Opening in EURO Counters
EURUSD May Down Below 1.2900
Cyprus Big Bailout announcement over the weekend (16th March, Saturday) affects World Financial market specially foreign Exchange Market (Forex) deeply. The Announcement of Controversial levy on bank deposits in global asset shakes up Mondays markets. Under Saturday’s rescue deal, international creditors agreed to provide 10 billion euros ($12.9 billion) to the country. In return, Cyprus plans to sell government assets, raise corporate-tax rates and impose a tax on interest earned in Cypriot banks. But most controversially, the aid package also requires a one-off levy on deposits in all Cypriot banks.Under the plan, those with more than €100,000 in one of Cyprus’s banks will be hit with a 9.9% charge, while depositors with smaller amounts will see a 6.75% one-off tax. In return, the depositors will receive shares in the country’s lenders.
The move marks the first time in the euro-zone debt crisis that depositors in any member country have been required to take a haircut on their bank holdings, and investors are unsure about the fallout.
Source: Market Watch Blog. Click Here to read more
