BLBG:Euro Drops Against Yen, Dollar Before EU Leaders Meet At Summit
The euro fell against the yen and dollar before a European leaders’ summit aimed at stemming the region’s debt crisis and as Italy prepares to sell as much as 5.5 billion euros ($6.83 billion) of bonds.
The 17-nation currency reversed a gain of as much as 0.5 percent against the dollar after the Ifo economic research institute said Europe’s sovereign-debt crisis will weaken Germany’s economy this year and a report showed unemployment in the nation climbed in June. The euro is poised for its biggest quarterly drop versus the yen since September amid concern the bloc’s fiscal woes are spreading to bigger economies.
“You can talk about unfinished business at the EU summit but things could take years to solve and the markets haven’t got that long,” said Chris Turner, head of foreign-exchange strategy at ING Financial Markets in London. “It seems like the euro is going to take the strain and peripheral debt will remain under pressure.”
The euro fell 0.9 percent to 98.52 yen at 9:42 a.m. London time. It slid 0.3 percent to $1.2427 after earlier rising to $1.2524. The dollar dropped 0.6 percent to 79.28 yen.
ING forecasts the euro will decline to $1.22 in the next month.
To contact the reporters on this story: David Goodman in London at dgoodman28@bloomberg.net; Neal Armstrong in London at narmstrong8@bloomberg.net
To contact the editor responsible for this story: Daniel Tilles at dtilles@bloomberg.net
