BLBG:Euro Declines as Rajoy and Monti Meet Amid Weak Economic Outlook
The euro approached a two-week low against the dollar as Italy and Spain’s premiers meet amid a growing divide over Europe’s new bailout strategy and data that shows the crisis is weighing on the region’s economy.
The dollar and yen strengthened as signs of global economic weakness increased demand for haven assets. Italy’s Mario Monti is set to meet Spain’s Mariano Rajoy in Madrid as pressure mounts on the Iberian nation to request aid. A report today showed retail sales in Spain dropped 11 percent in September from a year ago. The euro slid to a two-week low against the yen as German Finance Minister Wolfgang Schaeuble rejected another debt restructuring for Greece.
“There’s a bit of a negative tone now,” said Neil Mellor, a foreign-exchange strategist at Bank of New York Mellon Corp. (BK) in London. From Spain “the market has been waiting for that next degree of impetus but it’s not happened. In the meantime we’ve had all the negative data out.”
The euro weakened 0.2 percent to $1.2907 as of 9:43 a.m. London time. It reached $1.2883 on Oct. 26, the lowest level since Oct. 11. The 17-nation common currency fell 0.3 percent to 102.78 yen, after sliding as low as 102.52, the least since Oct. 16. Japan’s currency was little changed at 79.63 per dollar.
The euro dropped 1.6 percent in the past six months, the second-worst performance after the Swiss franc among the 10 developed-nation currencies tracked by Bloomberg Correlation- Weighted Indexes. The yen gained 2.2 percent and the dollar rose 1.3 percent.
To contact the reporter on this story: Lucy Meakin in London at lmeakin1@bloomberg.net.
To contact the editor responsible for this story: Paul Dobson at pdobson2@bloomberg.net.
