Euro Drops Most in Almost Month on Concern European Debt Crisis Worsening
The euro fell the most in almost a month against the dollar as Moody’s Investors Service cut Portugal’s government bond rating to junk and European banks faced more stringent stress tests.
The Swiss franc rose this week against all of its major counterparts as Europe’s debt crisis spurred demand for a refuge. The dollar fell against the yen for the first time in three weeks after the U.S. payrolls report showed employers added the fewest jobs in nine months. President Barack Obama prepared to meet with congressional leaders tomorrow in a rare Sunday meeting on cutting deficits and raising the debt limit.
“The headline event for this week was the four-notch downgrade to Portuguese debt by Moody’s,” said Ravi Bharadwaj, a market analyst in Washington at Travelex Global Business Payments, a currency-exchange network. “It seems like a lose- lose situation for the euro-dollar right now.”
The 17-nation euro fell 1.8 percent to $1.4265, from $1.4526 on July 1, after touching $1.4206 yesterday, the lowest since June 27. The drop in the currency is the biggest since the five days ended June 10, when it fell 2 percent. The euro slid 2 percent to 115.03 yen, from 117.42. The dollar slumped 0.2 percent to 80.64 yen, from 80.83.
The Swedish krona was the biggest loser against the dollar, depreciating 1.9 percent to 6.3832. The krona rallied 3.7 percent last week before the Riksbank’s meeting on July 5, when policy makers increased the benchmark repurchase rate by a quarter-percentage point to 2 percent.