Members login
The euro fell Thursday below the key USD1.33 mark.
Written by article default Thursday, 22 April 2010 08:44
Market OverviewThe euro fell Thursday below the key USD1.33 mark as fresh worries over Greece's fiscal position led investors to flee riskier assets for the safety of the dollar.
Greece's deficit for last year is worse than the cash-strapped country originally reported and could still be revised higher, the European Union said Thursday, spotlighting the stressed finances of the euro-zone periphery and weighing on the common currency.
The euro hit a two-week low against the dollar and declined more than 1% against the yen by New York morning trade. A fall in U.S. stocks sped the common currency's decline as investors took money out of riskier assets. Currencies closely tied to global growth, such as the Canadian and Australian dollars, also declined as risk fled markets.
The ICE Dollar Index, which tracks the greenback against a trade-weighted basket of currencies, was at 81.640 from 81.212.
Market expectation
Speculation is growing that Greece will need to restructure its monstrous debt burden even as it struggles to get access to global capital markets.
As yields on Greek bonds a key measure of investor sentiment spike to record levels and investors go wanting for details of a plan to backstop Greek debt.
With public-sector debt expected to exceed 120% of gross domestic product this year, analysts and traders say that the market is increasingly pricing in the risk of a debt restructuring.
Meanwhile, investors awaited a speech by President Barack Obama, who is scheduled to speak in New York on financial regulation.