By TraderVox.com
Tradervox (Dublin) – The 17-Nation currency has dropped most in seven months against the yen due to concerns about the region’s sovereign debt crisis. This was evident in the recent Spain bond auction where investors shied away from taking the debt. This has been construed to mean that the regions efforts have not convinced investors enough to take new debt in the region. Investors are also fearful of the rising borrowing cost in Spain that has fueled concerns that debt crisis has not been contained.
According to an FX Prime Corp managing director, there has not been major improvement in the European debt situation despite the successful Greece bailout program. Marito Ueda indicated that investors are shifting their focus to other countries with debt problems such as Portugal, Italy, and Spain.
The euro has continued to decrease against the yen where it has registered a 0.1 percent decrease to trade at 107.51 yen from 107.61 close yesterday in New York. It has registered a weekly decrease of 2.8 against the yen, which the worst drop since the Friday September 9 last year. The euro maintained its yesterdays close against the dollar at $1.3070. The 17 nation currency had earlier dropped to 1.3035, which is the lowest it has been since March 15.
Euro’s bearish run has come as some negative reports from the region were released this week. In Germany, there is speculation that the export data will show a 1.2 percent decrease in February. Analysts are also expecting to see data from France that will show that the country’s output increased at a slower pace in February than in January. Further, comments by Spain’s Prime Minister Rajoy indicating that the country is in “extreme difficult” have also resulted to the decrease of the euro against major peers.
Among the ten developed economy, the euro has registered the worst performance this week declining by 1.3 percent. The dollar and the Yen have both increased by 1 and 1.9 percent respectively.
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