The single currency Euro moved closer to a 9-month trough versus the U.S. Dollar in Asian trading today, as investor doubt grew as to whether or not European Union policymakers would help the heavily debt burdened nation of Greece.
Despite lackluster trading in Asia with many regional markets closed for a local holiday, the Euro slipped to $1.3600, a decline of .2% and near the $1.3532 low established last Friday on the EBS trading platform, the lowest in nine months.
Investors suggest that the currency is highly vulnerable; indeed, the Euro has slipped almost 10% since late last year, largely due to investor concerns over Greek fiscal troubles, and more recently, with similar fiscal worries being seen in Portugal and Spain.
While last week’s meeting of the European Union leadership resulted in a consensus that the situation has to be closely monitored in Greece, no concrete action plan was discussed. Jean-Claude Trichet, the President of the European Central Bank, in a statement issued yesterday, commented that extra measures must be put into place by the Greek government in order to remedy the nation’s budget deficit.
In a note to clients, J.P. Morgan management commented that while a liquidity fund with some conditionality is needed in the Euro-zone, it is unlikely that the E.U. ministers will deliver one within the week.