By TraderVox.com
Tradervox.com (Dublin) – The 17-nation currency remains low against the dollar as Spain prepares to present it budget cuts to boost the economy. The euro has fallen against the yen for more than a week after reports from Germany showed that unemployment increased in the country for the sixth month. The unemployment is due to the slowing global economy and the debt crisis in Europe which has escalated, forcing companies to hold on their gains. The dollar index remained unchanged prior to the release of a report projected to show US durable goods orders dropped in August. According to Lutz Karpowitz, the focus today is on Spain, which has enhanced the pressure on the euro. Karpowitz, who is a senior foreign-exchange strategist in Frankfurt at Commerzbank AG added that the pressure on the euro will continue even after the Spanish budget as the tensions in the country and Greece remains high.
The Greek exit from the euro zone has been discussed by several leaders in the region, with Czech President Vaclav Klaus saying that the exit of one or more member states will not destroy the monetary union. Czech Republic, which is aspiring to join the euro zone, has indicated that it is under no pressure to join the common currency. Czech President termed the troubled Greece as a “victim” of the monetary union.
The 17-nation currency remained at $1.2874 at the start of trading in London today after declining to its lowest since Sept 12 of $1.2835. It remained at 100.03 yen per euro, extending its longest declines since May 31. The yen remained strong against the dollar at 77.70 yen per dollar. Economists are predicting that the euro may weaken to $1.22 by the year end. The Spanish cabinet will meet at 11a.m Madrid time and later a press conference will be held. The draft law on austerity measures will be presented to parliament on Sept. 29.
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