BLBG:Euro Falls To Six-Week Low Against Yen After Inflation Stagnates
The euro fell to a six-week low against the yen after European inflation stagnated in June, adding to evidence the region is moving toward its second recession in three years.
The 17-nation currency dropped below $1.22 for a third day versus the dollar after German Chancellor Angela Merkel said she hasn’t softened her stance on measures to stem contagion that’s prompted five member countries to seek international aid. The Swedish krona declined the most among the 16 major currencies before the central bank releases minutes tomorrow of its July policy meeting.
“Euro negativity is still pretty elevated,” said Jeremy Stretch, head of foreign-exchange strategy at Canadian Imperial Bank of Commerce in London. “There’s still a great deal of uncertainty about how the European problems are going to be worked through.”
The euro declined 0.8 percent to 96.25 yen at 10:57 a.m. in London after falling to 96.19 yen, the lowest level since June 1. The single currency depreciated 0.5 percent to $1.2185. It slid to $1.2163 on July 13, the weakest since June 2010. The yen gained 0.2 percent to 78.99 per dollar.
The euro has declined 4.2 percent in the past three months, the worst performer of the 10 developed-nation currencies tracked by Bloomberg Correlation-Weighted Indexes. The yen advanced 6.3 percent, and the dollar gained 4.2 percent.
The rate of inflation in the euro area was at 2.4 percent in June, the same as in May, the European Union’s statistics office in Luxembourg said today. A gauge of investor confidence in Germany, the region’s biggest economy, slid to minus 20 this month from minus 16.9 in June, a separate survey showed before tomorrow’s release.
To contact the reporters on this story: Lukanyo Mnyanda in Edinburgh at lmnyanda@bloomberg.net
To contact the editor responsible for this story: Daniel Tilles at dtilles@bloomberg.net
