The Euro continues to decline on rising contagion fears and growing worries that Greece will be compelled to exit the Eurozone. As reported at 2:05 p.m. (JST) in Tokyo, the Euro was trading 0.2% lower at $1.2674, increasing the month’s loss to 4.1% and edging closer to the 2012 trough of 1.2624 which analysts say will put the EUR/USD pair at a low not seen in more than 20 months. One currency analyst believes that there could be some albeit limited support from options-related players ahead of a weekend that includes a meeting of the G8. The Greek election is scheduled for mid-June, and analysts expect that if the anti-austerity parties take a firmer foothold, it will hasten the Euro’s downtrend with 1.20 likely tested at that time.
The Euro was able to inch higher against the Japanese Yen, and the EUR/JPY pair was recently trading at 100.71, not far from the February 7th low of 100.56 Yen. The Yen gained broad strength yesterday after the country posted a much better than expected first quarter GDP number, but the government’s to preventing the Yen’s rise from safe haven-seeking investors is keeping currency traders wary. The Finance Minister of Japan said that he was worried about the currency’s renewed strength and was carefully monitoring movement, a signal to investors that the government would not hesitate to again intervene.