Euro Slips on Violence over Greek Austerity Measures

By: Barbara Zigah

Violence and the news of several deaths from rioting over the implementation of austerity measures in Greece have investors speculating that the Greek nation may be on the verge of bankruptcy, despite the promise of a joint bailout package from the E.U. and the IMF. As a result, the common currency Euro fell to the lowest level in 14-months versus the U.S. Dollar, trading at $1.2789 before rebounding to $1.2820 at 12:50 p.m. (JST) on hedge fund portfolio adjustment. Nonetheless, one investment manager in Japan likens the Euro to a sinking ship, and suggests it would be foolhardy to continue buying the single currency. 


Adding insult to injury, Moody’s, the international ratings service, said yesterday that it may lower Portugal’s credit score from the current Aa2 rating; such a downgrade will put even more pressure on the Euro. A meeting of the Governing Council of the European Central Bank is scheduled to be held later today, and investors will be keen to hear the ECB President’s comments on the Greek crisis.

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The mounting problems in Greece in particular, and the Euro-zone, in general, have been beneficial to safe haven currencies, with investors demand growing. The U.S. Dollar rose against the Yen, trading at 93.93 Yen, up from late New York trading of 93.66 Yen. Dealers speculate, however, that the Yen will gain against the greenback as a result of falling share prices coupled with the Euro-zone fiscal troubles.



Barbara Zigah

After working on Wall Street, Barb began her second career as a freelance writer at Daily Forex, where the CEO recognized fresh, untapped potential and was willing to give her a try. She’s never looked back. Since then, she’s worked steadily as a freelance writer and editor in the financial services and Forex-related industry.