Euro Slumps As Spain Deal Fails to Allay Crisis Concerns

The euro came close to touching a two-year trough against the dollar and hit a five-week low versus the yen on Tuesday after a meeting of euro zone finance ministers failed to assuage concerns about the region's crisis despite efforts to help debt burdened Spain.

Euro zone finance ministers agreed to grant Spain an extra year, until 2014, to reach its deficit reduction targets, in exchange for further budget savings and set the parameters of an aid package for the country's ailing banks.

The euro [EUR= 1.2256 -0.0057 (-0.46%) ] fell as low as $1.2261, not far from a two-year low of $1.2255 hit the previous day. It last traded at $1.2253, down 0.5 percent on the day.

But the euro succumbed to selling pressure as they made no apparent progress on activating the bloc's rescue funds to intervene in bond markets to bring down spiraling borrowing costs for Spain and Italy.

Read Full Article from CNBC.com

- Posted: 2012-07-10 12:58:17

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