By Ben Levisohn and Lukanyo Mnyanda May 3 (Bloomberg) -- The euro fell for the first time in four days against the dollar on concern the European Union and International Monetary Fund’s 110 billion-euro ($145 billion) bailout package for Greece will fail to win support from some of the region’s governments. Europe’s common currency gained for a fourth day against the yen before EU members debate the implementation of the program this week and Greek unions called for a strike to protest austerity measures. South Korea’s won ended a two-day gain after China raised bank reserve ratios for a third time this year to cool the world’s fastest-growing major economy. The pound fell as polls signaled neither of the U.K.’s two biggest parties will gain a governing majority in this week’s election. “The euro fell because the package hasn’t been approved yet and there’s dissension in the ranks,” said Jessica Hoversen, a Chicago-based analyst at the futures broker MF Global Holdings Ltd. “The real fear is that Greece won’t be able to make the budget cuts.” The euro dropped to $1.3242 at 8:39 a.m. in New York from $1.3294 last week, after earlier rising as high as $1.3361, the strongest level since April 27. The 16-nation currency rose to 125.07 yen from 124.78 yen. The dollar was at 94.39 yen from 93.85 yen. Japanese financial markets were shut today for a holiday. U.K. markets were also closed. Loan Approval Timeline EU leaders are scheduled to meet on May 7 to discuss the timeline of parliamentary approval for loans to Greece. Germany is due to debate the plan on the same day. Greece’s three-year financial lifeline requires the nation to cut its budget deficit below the EU limit of 3 percent of gross domestic product by the end of 2014, a year later than originally planned. The deficit was 13.6 percent last year, the region’s second-largest after Ireland. The austerity measures include a second set of wage cuts for public workers and a three-year freeze on pensions. Unions representing more than 500,000 civil servants called a 48-hour strike starting May 4 to protest what they have called “savage” budget cuts. Local government workers called a strike for today. Teachers are also on strike from tomorrow and a general strike, the third this year, is planned for May 5. ‘Terrific Recession’ “For Greece, this means terrific austerity and terrific recession,” Marc Faber, publisher of the Gloom, Boom & Doom report, said in a Bloomberg Television interview in Hong Kong. “The euro will remain weak, and there’ll be more bailouts,” EU finance ministers yesterday approved the unprecedented bailout amid growing evidence the Greek fiscal crisis is spreading to Portugal and Spain. The extra yield investors demand to buy Greek 10-year debt over German bunds narrowed 45 basis points today while that for Portugal dropped 3 basis points. Futures traders are more bearish than ever on the euro, suggesting further declines ahead for Europe’s shared currency. Hedge funds and other large speculators raised net wagers on a euro drop by 25 percent to 89,013 contracts in the week ended April 27, Commodity Futures Trading Commission data show. The euro has depreciated 7.6 percent against the dollar this year, including last week’s 0.7 percent loss, on concern the sovereign debt crisis will slow Europe’s economy. ‘Greece is Lehman’ “Greece is a Lehman Brothers for the sovereign world,” Robin Marshall, who helps oversee $20 billion as director of fixed income at Smith & Williamson Asset Management in London, said yesterday. “A 100 billion-euro package is a big amount and it might help to buy Greece some breathing space, but as an investor I’m still cautious.” South Korea’s won fell 0.9 percent to 1,118.40 per dollar, leading Asian currencies lower after China increased bank reserve ratios yesterday. The Shanghai Composite Index tumbled 12.4 percent this year on concern government measures to cool the property market and the economy will hurt profits. “This is one more step in the tightening process,” said David Cohen, an economist with Action Economics in Singapore. “The big question is when China will allow renewed appreciation, and traders realize it’s not going to happen this week.” Britain’s pound lost 0.1 percent to $1.5254, pushing its decline the past two trading days to 0.4 percent. Surveys by YouGov Plc and ICM Ltd. today showed Prime Minister Gordon Brown’s Labour Party narrowing the Conservatives’ advantage in popular support and retaking the lead in the forecast number of seats in Parliament. The election will be held on May 6. To contact the reporters on this story: Ben Levisohn in New York at blevisohn@bloomberg.net; Lukanyo Mnyanda in London at lmnyanda@bloomberg.net

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