During the first four months of 2011 eurozone tension eased, although trouble at the periphery never went away. However, with yield spreads starting to blow out across the region (the 10 year German-Spanish yield spread posted a new wide for the year late last week) it would appear tension is again building. Safe haven demand for CHF has soared driving EUR/CHF to a new all-time low and EUR/USD is threatening important support between 1.3900/75.
BARCLAYS CAPITAL
Foreign Exchange Research