By: Barbara Zigah
Market players sold off their short term holdings in the Euro in Asian trading today, worried about the effectiveness of any rescue plan that the G20 may come up with the help the Greek nation out of its debt troubles. In early morning trading in Tokyo, the Euro slipped against the U.S. Dollar to $1.320, the lowest point in nearly a year. The Euro also slipped against the Japanese Yen, trading at 123.64 Yen, off from yesterday’s late trading at 124.52 Yen in New York. Worries that Greece may default on upcoming debt payments could potentially drag the Euro down further. The meeting of industrialized nations meets in Washington today and market players are hopeful that something positive will come out of the meeting, which will help to bump up the Euro, even if only in the short term.
Overnight developments emphasized Greece’s fiscal problems, according to some analysts. The E.U. statistics agency reported that the budget deficit in Greece was more than reported originally. Further, Moody’s, a key ratings agency, downgraded Greek sovereign debt to A3 from A2.
In spite of the Euro’s softness, the U.S. Dollar Index, a measure of the greenback’s strength versus a group of major currencies which includes the Euro, gained slightly, moving from 81.572 .DXY to 81.897 .DXY.