By: Barbara Zigah
The single currency Euro fell to a new 1-year trough in Asian trading today, attributed largely to continuing investor concerns over the Euro-zone’s fiscal problems, and a round of selling by Japanese exporters, which triggered the fall. As at 3:18 p.m. (JST) in Tokyo, the Euro trimmed earlier losses to stand at 120.70 Yen, a loss of 1.1% on the day; earlier in the session, it had struck a new 1-year low versus the Japanese yen on the EBS trading platform, trading at 120.44 Yen. Versus the U.S. Dollar, the Euro lost .6% and traded at $1.3461 on the EBS platform, nearing the 9-month low struck last week.
Greece’s fiscal problems are likely to get worse when and if Standard and Poor’s downgrades their sovereign debt, as they have threatened to do, with a possible one or even two step downgrade, below Greece’s current BBB+ rating.
The Japanese Yen saw a broad rally, however, trading up nearly 1% against the Pound Sterling, the New Zealand and Australian Dollars, and the Euro. Traders in Japan commented that the Yen/cross was selling in large lots, by Japanese exporters as well as foreign hedge funds.