Euro weakens on eurozone worries - Emirates24|7

Euro weakens on eurozone worries

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The euro slumped to 16-month dollar lows Thursday amid a sharp upsurge in eurozone debt tensions and strong US jobs data.

At 2200 GMT, the euro traded at $1.2789, down from $1.2941 late Wednesday.

Dealers said sentiment was hit badly after Spain's economy minister warned that the country's banks could need 50 billion euros to cover bad loan losses.

A surprise visit by Italian Prime Minister Mario Monti to Brussels also stoked fresh uncertainty, although diplomatic sources in Belgium said his trip was completely private.

The US data released, especially figures on private sector jobs creation last month, appeared to confirm the strengthening of the economy -- and boosted the dollar.

"Today's macroeconomic releases were consistent with the belief that the US is decoupling from the rest of the world following a recent improvement in data," said David Morrison of FX360.

"Added to this is a belief that the Federal Reserve will continue to add liquidity any time that asset prices come under pressure."

The euro fell to 98.67 Japanese yen from 99.28, while the dollar gained to 77.15 yen (76.71 yen).

The dollar also rose to 0.9525 Swiss francs from 0.9417, while the British pound dropped to $1.5492 ($1.5616).

 

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