During the Asian trading session, the common currency Euro continued its slide edging near to a 21-month trough as worries over a disorderly Greek exit escalate. Yesterday, the Euro’s rapid decline was brought about by a media report which quoted Lucas Papademos, the former Greek Prime Minister, as saying that the country had no option other than to accept austerity or face a Eurozone exit. One analyst in Singapore likened those comments to “strong poison” which exacerbated the markets’ volatility
As reported at 12:26 .p.m. (JST) in Tokyo, the Euro was trading against the greenback at $1.2643, only a pip above last week’s low, and approaching the low of $1.2624, which was set in January of this year; a break through this level would bring the EUR/USD pair to a low not seen in nearly 2 years and pave the way to $1.25. More recently, the Euro-Dollar was trading at $1.2677, still a loss of 0.1% from late New York trading.
Conversely, the demand for safe haven currencies accelerated. The U.S. Dollar Index rose to a level not seen in 20 months, and was trading at 81.830 .DXY; the Index Dollar Index represents the greenback’s strength relative to several major currencies (including the Euro) and is generally seen as a good gauge of investor sentiment.