By: Barbara Zigah
The common currency Euro dropped to a new 14-month trough versus the U.S. Dollar, losing nearly 1.6% of its value following a plunge in stock prices in the U.S. markets which prompted SEC officials to investigate the cause. As reported at 2:58 p.m. (JST) in Tokyo, the Euro was trading at a low of $1.2510 before rebounding on the EBS trading platform to $1.2700; finally, the common currency settled back at $1.2700. This week, on track to be the worst week for the Euro in more than 17 months, the Euro has lost nearly 4.5%. The rebound was attributed to the announcement by an official from the U.S. Treasury that the Group of Seven finance ministers would be discussing the Greek debt crisis during a phone call today.
Investors continue to worry that the fiscal problems in Greece and other Euro-zone nations could extend beyond the borders of the Euro-zone. That concern helped the safe haven Yen and U.S. Dollar soar against the Euro. The U.S. Dollar Index, which measures the greenback’s value versus a weighted basket of currencies, traded at 84.92 .DXY, nearing a 1-year high. Later today, labor data from the U.S. will be released, and if analysts’ predictions hold true, the U.S. Dollar could see further gains.