Over the last few weeks, the Euro has quietly strengthened to recent highs against most other major currencies, despite economists' forecasts for a Eurozone recession this year. As of this morning, the Euro is trading at $1.36 against the dollar, up from $1.30 at the end of last year and the one-year low of $1.24 on August 31st. Massive monetary easing programs by the U.S. Federal Reserve, the Bank of Japan, and the Bank of England, and talk of lower rates by the Bank of Australia have made the Euro attractive, as the European Central Bank has shied away from similar monetary easing measures. The problem with this recent currency strength lies in the European export market, as a strong Euro makes products more expensive to those outside of the block. This comes at a time when economies such as Greece, Spain, and Italy are struggling to grow output to combat a reduction in government spending. We have opined that the problems facing the Eurozone will only be averted if underlying economic fundamentals improve and governments follow through with much needed reforms. Peripheral Eurozone debt markets are weaker this morning, as news of an illegal payment scandal in Spain and complaints from Greek officials about the strength of the Euro weigh on sentiment. As we move forward, these developments bear watching, as the implications of a volatile Euro have global effects.