Euro Slips Further on Greek Ultimatum

By: Barbara Zigah

The Euro has slipped further back and near to a 3-week slow in Asian trading today, as worries over the planned Greek referendum escalate. Market players are expecting that there will be significant downside risks for the currency over the next several months. As reported at 12:32 p.m. (JST), the Euro was trading against the greenback at $1.3687, retreating 0.4% and approaching the 3-week trough of $1.3608 struck earlier in the week. One forex strategist in Hong Kong put it bluntly; traders are negative on the Euro, and there is little opportunity for a Euro rally any time soon.

Greece’s referendum, with a positive vote outcome, is an absolute requirement if Greece is to receive its next tranche payment. That ultimatum was given to the Greek prime minster by both the French and German leadership. They jointly said that there would be no more money for Greece until it makes a decision as to whether or not it wants to remain in the Eurozone.

Other higher risk currencies are also suffering from the Euro crisis; the Australian Dollar earlier tumbled 1% against the U.S. Dollar to $1.0238, with analysts saying that options selling exacerbating the drop.