The euro swung between gains and losses after Spain signaled it may sell more bonds to recapitalize the Bankia group, stoking concern the region’s debt crisis is deepening. The 17-nation currency was 0.3 percent from the lowest since July 2010 and German 10-year bund yields dropped to a record after European Central Bank Governing Council member Ewald Nowotny said a revival of bond purchases is not being discussed. The euro rose yesterday after polls showed Greece’s pro-bailout parties gaining ground, damping speculation the nation will exit the currency bloc. “There are bullets flying from every angle and confidence is incredibly low and that looks set to remain the case,� said Kit Juckes, head of foreign-exchange research in London for Societe Generale SA. “Spain’s problems immediately replaced Greece. It’s just a matter of time before we head down to $1.20� per euro. The euro was little changed at $1.2524 at 12:51 p.m. London time after touching $1.2496 on May 25, the lowest since July 6, 2010. It has lost 5.3 percent in May. The euro traded at 99.71 yen after having dropped 5.7 percent this month to 99.67 yesterday. The yen was little changed at 79.56 per dollar. To contact the reporter on this story: Lucy Meakin in London at lmeakin1@bloomberg.net To contact the editor responsible for this story: Daniel Tilles at dtilles@bloomberg.net

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