FXstreet.com (Barcelona) - Asian markets have gone through sharp declines on Tuesday, on renewed fears about the health of Euro Zone's banking system, and a negative ending on Wall Street on Monday. In FX markets, Euro and Pound have dipped on risk aversion. Japanese Nikkei Index fell 2.4% to reach its lowest level since last December, while South Korean Kospi Index dropped 3.2% hammered by escalating tensions between the two Koreas. Taiwan's Taiex Index fell 2.7% and benchmark markets in Australia and Hong Kong have lost 1.8%. Fears about the contagion of Greece's fiscal debt problems through other Eurozone countries still looming, have reactivated after Spanish Central Bank announced a $700 bailout to save CajaSur, increasing doubts about the stability Euro Area's banking system, and sent the Euro down to levels close to the previous week's four-year lows. Euro and Pound drop as confidence fades EUR/USD decline from May 21sst high at 1.2670 extended yesterday to 1.2345 low, and the European currency dipped lower during Asian session, to reach prices below 1.2300 ahead of the European opening. GBP/USD remains trading within last week's range, supported by 14 month low at 1.4230 and capped on the upside by resistance at 1.4500/20. The Pound reached 1.4530 high at Monday's European opening, where it was rejected, and the pair has been pulling down since to reach 1.4325 low on Tuesday's Asian session. USD/JPY remained moving in range between 89.75 and 90.60 on Monday, and rejected at the latter level on US session, the pair has pulled down on Asian trade to test 89.75 level at European session opening.

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