Abu Dhabi pledge prompts euro rise

The euro looks set to continue to gain strength, as the currency rose 0.76 per cent against the dollar at 9.55am today (December 15th).

A continued increase could encourage Britons to consider expatriating to European destinations such as France and Germany to take advantage of the relative stability of the currency.

The strengthening of the euro comes as Abu Dhabi has pledged to bail out Dubai World, prompting a feeling of reprieve amongst the banks.

There had been worries that the European banks would be forced to write down loans to the state-owned holding company Dubai World.

Abu Dhabi's pledge of $10 billion (£6 billion) in assistance has helped to alleviate these concerns.

George Davis, chief technical analyst for fixed-income and currency strategy at RBC Capital Markets in Toronto, told Bloomberg that the bail out was a "relief".

He continued: "Dubai's problems been alleviated for the next few months, and that's put the market on firmer footing."

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Posted by Sarah Rocca