BNP Paribas | Dec 23, 2012 05:41AM ET
The euro and the stock markets ended the year 2012 on a strong note. If the predictive power attributed to the markets proves true, this augurs well for 2013. The single currency has gained nearly 10% against the dollar over the past five months. At USD 1.33 on 19 December, the euro is close to last January’s highs. The Eurostoxx index is also at a peak. At 366 points on 19 December, it has gained 26% since early June, the starting point of the stock market rally. This is twice the performance of the S&P500.
The European heads of state and governments also made their contribution by showing proof of solidarity: banking union project (29 June); a more relaxed timetable for reducing public deficits in Portugal and Spain; a EUR100bn credit line to recapitalise Spanish banks; and the rescheduling of Greek debt (27 November), which was heralded by a 6-notch upgrade of its sovereign rating on 18 December.
By Jean-Luc PROUTAT
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