Wednesday saw the shared currency of the European Union slide against the U.S. dollar after earlier gains that were prompted by the central bank of Japan announcing it will move forward with monetary stimulus to spur its economy, MarketWatch reports.
But the losses were due to German officials minimizing the potency of proposals for a European banking union. As host of the 17-nation region's largest economy, Germany also aimed to reduce the potential role that the European Central Bank would fulfill as the region aims to emerge from the duress caused by the sovereign debt crisis.
"The ECB has an unlimited bond buying program while the Fed has an open-ended easing scheme so the market will soon ask whether the BOJ's easing would be more effective than the others, or less," chief strategist Daisuke Uno with Sumitomo Mitsui Banking Corp in Tokyo told Reuters.
The Wednesday trading session began with the euro on the uptick, benefiting from the Bank of Japan announcing it will ease monetary policy.
The euro, an asset considered more risky, benefited from investor interest as it gained against the world's reserve currency, Reuters reports.
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