RTTN:Euro Eases On Stocks Slide, Merkel's Comments
The euro retreated against most major opponents in the European session on Friday, as European shares slipped on weak earnings results from Microsoft and Google.
German Chancellor Angela Merkel rejected the idea of second debt writedown to Greece, saying that it will bring more challenges to Eurozone, according to a Reuters report.
The euro was also under pressure following Merkel's comments.
While addressing a press conference at Berlin, Merkel told that Greece does want a restructuring and the second haircut would bring more uncertainty to the euro area.
The European Central Bank tweaked its collateral rules, expanding the list of collateral accepted and reducing the haircuts applicable to asset-backed securities, in an effort to boost lending to struggling small businesses.
The ECB decided to reduce the haircut applicable to asset-backed securities, or ABS, eligible under the permanent and temporary Eurosystem collateral framework, to 10 percent from 16 percent.
The euro fell back below the 1.31 level against the buck, pulling away from an early 2-day high of 1.3150. The euro may face next downside target around the 1.30 level.
The single currency fell to 1.2359 against the franc, reversing from a multi-day high of 1.2392 set yesterday. On the downside, the euro may face support around the 1.23 area.
The euro reached 0.8589 against the pound, its lowest level since July 10. This may be compared to previous session's high of 0.8631. Further breakdown of the euro may see it testing support around the 0.85 level.
The U.K. public sector net borrowing excluding interventions declined to GBP 8.5 billion in June from GBP 11.9 billion last year, data from the Office for National Statistics showed today.
The ONS said PSNB has been reduced by GBP 3.9 billion of cash transfers from the Asset Purchase Facility Fund to government.
The euro dipped to an 8-day low of 1.6475 against the NZ dollar, easing from an early high of 1.6624. The 17-nation currency reversed from an early 3-day high of 1.4334 against the aussie and dropped to 1.4235.
