Fitch downgrades Irish Banks’ guaranteed debt and revises the outlook on Allied Irish and Bank of Ireland to negative. Typically the sovereign debt is cut first and the bank debt follows a few days later and this fits the pattern.
If the market switches its focus from quantitative ease (which is largely priced in) to European dent woes, the long awaited correction to the uptrend could have room to run.
1.3900/10 bids remain in place with EUR/USD trading in the 1.3918 area,
