Wednesday saw the common currency of the European Union edge higher against the U.S. dollar as speculation mounted that Cyprus and the central bank of Europe ultimately will hash out a pact and emergency bailout aid for the nation will be disbursed, Bloomberg reports.
The euro reversed three-straight days of losses against the U.S. dollar and seven consecutive days against the Swiss franc one day after Cyprus leaders rejected the insistence of euro zone finance ministers to tax Cyprus nationals when making deposits in exchange for bailout aid. The European Central Bank offered Cyprus with liquidity.
"It is relatively calm for now, but headline risks remain acute," strategist Sue Trinh with RBC in Hong Kong told Reuters on Wednesday. "Clearly the 'no' vote was not an ideal situation. The government now has to scramble for last minute options and it remains uncertain how exactly it will unfold."
The finance minister of Cyprus is in the Russian capital to gauge support for his nation.
Investors are increasingly hopeful about Cyprus' prospects of hashing out a deal as concerns about the region returning to crisis are mounting, according to Reuters.
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