Bloomberg: Euro heads for fourth quarterly drop amid Greek bailout concern
The euro fell for a second day, heading for a fourth straight quarter of declines, amid concerns Greece will fail to reach agreement with its European creditors to unlock bailout funds, Bloomberg reported.
The single currency weakened versus all except two of its 16 major counterparts as the European Central Bank (ECB) buys sovereign bonds to support growth and stave off deflation.
The Greek Prime Minister Alexis Tsipras sought to rally a consensus in parliament for his effort to secure bailout funds after his proposals to bolster the nation’s finances failed to satisfy his European creditors.
“Markets are becoming more sensitive to the Greek issue…In addition, the European Central Bank’s quantitative easing is keeping downward pressure on the euro. Fundamentals point to euro selling,” said Shusuke Yamada, a Tokyo-based currency strategist at Bank of America Merrill Lynch.
The euro fell 0.5% to $1.0784 as of 7:05 am in London, after sliding 0.5% on Monday. The single currency has weakened 11% this year against the dollar.
Europe’s most-indebted state is locked in talks with euro-area countries and the International Monetary Fund over the terms attached to its 240 billion-euro rescue.
The standoff, which has left Greece dependent upon ECB loans, risks leading to a default within weeks and its potential exit from the euro area.