The G20 Summit has traditionally been known for its successful coordination of economic policy, no exception of the current summit in Mexico city. Non-eurozone countries refuse to fill more money to the International Monetary Fund until the eurozone countries did more. This draft, proposed last Saturday night where the G20 just started, was moving unexceptionally smooth in deciding other countries, such as the US, the UK and the Japan will not pour money into IMF if the eurozone itself does not do more, though shortly after the draft, many countries fled away quickly to avoid media press. The G20 is expecting the current size of eurozone’s 500bn to increase to EUR 750bn.

The stability fund, or the European Stability Mechanism, is nicknamed “firewall” to eurozone. The summit does however agree to make bilateral loans to the eurozone if it can give more money and strength into the crisis itself. Inevitably this is nothing but more Pressure to Germany. Berlin is being put to an awkward position. German minister issued statement again that his government believes that the extra increase in the Monetary Stability Fund is unnecessary since it would create disincentives for deeply troubled countries such as Italy and Spain. ntives" for countries like Italy and Spain to continue reforms. "Let me be clear. It does not make any economic sense [to take such measures],” he said, dismissing the idea of “endlessly pumping money into stability funds [or] starting up the ECB printing press". The pressure put on German is huge.

As a member of the European union, Germany’s economy benefited at the good time and it’s her responsibility to stand out at the rough time now. However, if the current austerity carried out Greece or Italy cannot convince the rest of the investors around the world, it’s not very fair to count on German’s financial bucket for more support. For Forex traders, the current economic outlook is still unsure, despite the boosting economic indicator released recently such the PI in Germany. A continuous close look needs to paid to the European fundamental economic status.

The G20 summit's pressure to the eurozone coutries, mainly Germany to stomp more money into the euro zone firewall, Eurupean Stablity Fund, may cause the market to be bullish on the euro dominiated currency pairs, EURJPY, and EURUSD.

However, the euro zone crisis may still pose a big threat to investors. Despite euro zone leaders have made some progress at attempting to overcome the crisis by agreeing a second bailout, worth 130bn euros, for Greece, the outlook of euro is not cleared.

The dollar index (DXY) is currently standing at 78.76, 2 am ET, higher than the three-month low of 78.095 hit on Wednesday. The dollar index is used to measure the rise of fall of the US dollar against a basket of other currencies.

Investors may need to watch ISM manufacturing index of this money, since the market’s speculation may start if the reading is weak. Ben Bernake, the Fed chairman, did not really change the market’s expectation that Fed is ready to ease the economic weakness. Investors may well well speculate the QE3 to come much sooner than June this year, when the operational twist is over.

If indeed the reading on QE3 is weak, the long-term downtrend of the dollar against yen may continue. Refer to Fig. 1

The investor’s taste to risk-free assets, e.g. the yen, may rekindle, since the inflation rate of the US is above the inflation rate target set by the central bank. Currently, data shows that the foreign investors were sellers of yen last week. Many Forex traders may want to wait for a lower yen before diving into the market.