Euro Falls From 7-Week High on Slowdown Signs

The euro fell from a seven-week high against the dollar before a report forecast to show the currency bloc’s economy contracted, adding to signs the three-year debt crisis is hindering growth.

The common currency slid versus most of its 16 major peers after Standard & Poor’s downgraded Greece to selective default. Along with data due today on the euro area’s third-quarter gross domestic product, European Central Bank President Mario Draghi and his board meet on policy. The New Zealand dollar rose against all its main counterparts after Reserve Bank Governor Graeme Wheeler said the outlook for the nation’s economy is stronger and policy makers kept interest rates steady.

“The data is clearly suggesting that the ECB is going to have to do something more,” said Ray Attrill, Sydney-based global co-head of currency strategy at National Australia Bank Ltd. “We could get some kind of a hint that rates could be cut at a future meeting. If we get any soundings in that direction from Draghi today, then that could put a little bit of pressure on the euro.”

The shared currency slid 0.1 percent to $1.3053 as of 12:25 p.m. in Tokyo from yesterday, when it touched $1.3127, the highest since Oct. 18. The euro was little changed at 107.74 yen after earlier dropping as much as 0.3 percent. The yen lost 0.1 percent to 82.55 per dollar, after weakening 0.7 percent to 82.47 yesterday.

via Bloomberg

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