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(Reuters) - Uncertainty over the fate of the euro currency is already dampening U.S. economic growth and any significant worsening of the crisis would deal a blow to a recovery that is gradually gathering steam. Economists estimate that volatile markets and business uncertainty over the fate of Greece and the policy course in Europe is already shaving anywhere from one tenth to one half a percentage point from U.S. 2012 gross domestic product growth. In a Reuters poll last week, U.S. GDP was forecast on average at 2.3 percent for 2012 and 2.4 percent for 2013. The direct hit to growth comes through trade. U.S. exports to the European Union account for 19 percent of total exports, and those to the euro zone represent 13 percent of the total. But when calculated in terms of GDP, the share ...

Fundamental Analysis EUR European stocks returned to growth, despite services and manufacturing purchasing managers indices across Europe and German business confidence shrank more than expected. The Stoxx Europe 600 Index added 1.0 percent to 241.81. Cable & Wireless Communications Plc soared 19 percent. Sonova Holding AG gained 2.5 percent. Bayer AG declined 1.1 percent. U.S. futures and Asian stock little changed. S&P 500 futures gained 0.3 percent, MSCI Asia Pacific index added 0.1 percent. USD The US Dollar followed bullish trend on Thursday as Germany disapproves issuance of Eurobonds that may help to ease Greek debt burden. Traders are also cautions ahead of Euro Zone's manufacturing data release due later today. The US Dollar index, which tracks the greenback's performance ...

(Reuters) - Gold eased on Wednesday extending sharp losses made in the previous session as investors were skeptical that an informal European Union meeting later in the day would yield steps to help solve the region's debt crisis. Gold fell to as low as $1,555.03 an ounce earlier in the day, its lowest level in nearly a week, tracking a weaker euro as investors fretted about the possibility of a Greek exit and its implications for the global economy. Investors will be watching the outcome from the EU summit, but confidence is on the wane since Germany and France are likely to confront each other on the idea of mutualized European debt. "Can it solve the debt crisis? No," said Dick Poon, manager of precious metals at Heraeus in Hong Kong, "Everyone is worried about Greece withdrawing ...

Gold prices rose more than 1 percent on Friday, building on the previous session's hefty gains, as a recovery in the euro prompted some buying of the precious metal, with shorts covering amid expectations prices could rise further. Gold posted its biggest one-day gain since January 25 on Thursday, recovering some ground lost during its longest run of losses in five months. Its reversal has put it on track to end the week 0.4 percent higher. Spot gold was up 1 percent at $1,589.16 an ounce at 1148 GMT, having earlier touched a high of $1,594.10, while U.S. gold futures for June delivery were up $14.40 an ounce at $1,589.30. The euro recovered from a four-month lows against the dollar to move into positive territory, taking some pressure off gold, though concerns over a Greek euro exit ...

Fundamental Analysis EUR "Industrial producion is a imely reminder that firstquarter GDP will likely show a contracion." - Marin van Vliet, an economist at ING Industrial producion in the Eurozone contracted unexpectedly in March, Eurostat data showed on Monday. Producion fell 0.3 per cent from February, when it rose 0.8 per cent. USD "The fear factor is definitely higher." - Madelynn Matlock, a fund manager at Hunington Asset Advisor U.S. stocks retreated on Monday on a poliical impasse in Greece. GBP "I can’t see even after the next Greek election a government appearing that will be able to do anything else than perhaps manage the Greek exit." - Simon Sole, chief execuive officer of Exclusive Analysis Ltd. U.K. stocks tumbled on Monday. The benchmark FTSE 100 Index fell 1.97%, or ...

(Reuters) - Fierce debate is growing in Europe over whether austerity or growth offers the best strategy to overcome the continent's sovereign debt crisis. As if it were that simple. As the euro zone hovers on the brink of its second recession in three years, the battle launched in academic journals, blogs and the financial press has spread to the hustings in France, Greece and soon in EU economic powerhouse Germany too. "Europe can't cut and grow," Sony Kapoor, head of the Re-Define think-tank, and Peter Bofinger, a member of the German Council of Economic Advisers, said in an article before European Union leaders adopted a budget discipline pact last month. "The EU needs a growth compact, not a fiscal one. Swift action on tax and jobs is the way out of the crisis." The growth camp ...

People Bank of China doubled the Yuan’s trading band against the dollar, where this operation reflects the confidence in the Chinese economy and its ability to get over the global crisis in a stable and independent way. The Chinese Yuan fell to record the lowest in three months against the USD after China’s decision to increase the Yuan’s trade band for the first time since 2007, aftre its daily rate fell by 0.13 to reach 6.2960. China’s Yuan fell against the dollar after these movements by 0.31% to reach 6.3228, after the PBOC’s decision of widening Yuan’s trade band to be 1%. Moreover, this movement will make the Yuan more flexible against other currencies especially against the dollar, as it will be the tool that will be used by the Chinese economy in controlling inflation rates and ...

(Reuters) - Oil prices at record levels in euro terms are threatening to rock the euro zone's economy more than might be expected, with those countries least capable of riding out a shock being the worst hit. Standard estimates of the impact of oil prices on the euro zone economy are that a 10 percent price hike dents annual growth by some 0.2 percent in the ensuing three years, with disagreement over whether the hit is greater at the start or at the end. However, these projections do not take into account the euro/dollar exchange rate and may underestimate the impact at a time of widespread austerity. Nor do they reflect potential differences across euro zone countries. In dollar terms, oil prices are still some 13 percent short of the $147.50 per barrel Brent peak hit in July 2008. ...

Dukascopy Technical Analysis EUR/USD "The euro has been on a firm footing. Should European finance ministers agree to beef up the rescue fund, the euro may get a bit firmer." - Mizuho Securities Co. (based on Bloomberg) The pair remains pretty resilient after the S&P announcement Greece might require another bailout package to restructure its debt and is capable of approaching the recent high at 1.3449. EUR/JPY "European Union discussions on the scale of the ESM (European Stability Mechanism), the Spanish government's 2012 budget plan and the China PMI figure... ahead of this, as well as all the U.S. data, the market is cautious." - SMBC Friend Securities (based on CNBC) As anticipated, EUR/JPY slipped lower yesterday ahead of the 111.57 level (intervention high). GBP/USD "With the UK ...