The Context

Thus, as many will recall, the euro grazed the 1.6 USD towards the month of April 2008 and remained close to that value until late in July she began its downfall, with attempts of recovery of through, until reaching the US $1.27 today. But the euro zone was not only involved with toxic assets that produced the crisis subprime in the us.UU. and it infected its financial system, but it has also been affected by the fall in economic activity in the country demonstrating the high level of dependence on the American economy and the limited capacity that has the internal demand of countries in the eurozone to offset weakening external. Such is the weakness demonstrated by the economy of the eurozone which in recent times has hesitated even on both sustainability economic block as such (because of the negative consequences that this type of situations suffer from some of its member economies, given the rigidity of action that such membership implies), and even the sustainability of the euro. The truth is that after having lost more than 20% of its maximum value, there is a great debate about the evolution of the relationship between the euro and the dollar. In relation to this theme there are two elements that make it likely the continuity of the weakening of the currency of the eurozone in relation to the dollar and which are continuity in the context of global uncertainty and the prospect of a further deterioration in economic conditions in the eurozone. In relation to the first factor, there is a high probability that the context of uncertainty remains for much of this year. Not only has complicated the picture for the recovery of the American economy and much more for the eurozone, but still it is not behind the possibility of occurrence of new episodes of crisis in banking systems.