Euro pinched by worries about widening debt scourge

Posted On: April 23, 2012
The common currency of the European Union dropped from its top rate in the past two weeks against the U.S. dollar on Monday, pulled by concerns about additional damage caused by the sovereign debt crisis, according to Reuters.

Italian bond yields and expenses for French borrowing climbed higher as the Dutch government was barreling toward collapse due to the inability to agree on budget cuts. As forecast, incumbent French president Nicolas Sarkozy lost the first round of presidential polls to Francois Hollande. The monetary unit also felt the pinch due to manufacturing falling in Germany at its most rapid pace in almost three years.

"It has not been a great start for the week for the euro with German PMI numbers adding to the worries stemming from the political risk factors," head of currency strategy Jeremy Stretch with CIBC World Markets told Reuters.

Losses to the euro were minimally tempered by commitments to double the size of the war chest of the International Monetary Fund to fight the debt scourge.

Bloomberg reports the euro's drop on Monday against the Japanese yen was the monetary unit's first losses to the Pacific Rim currency in five days.

Category: Industry News


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