Euro fell for a fourth day against the US Dollar as investors are nervous ahead of a Greek vote this week on unpopular fiscal austerity measures. The fear of a rejection of the measures and consequently Greece not receiving financial aid, caused a sell off of the Single Currency. EURUSD dropped almost 100 pips in Asian trading to a low of 1.4101.
Sterling fell to its lowest level since January against the Dollar. The Pound has been suffering recently from a spate of poor economic data giving a pessimistic view on the recovery of the UK economy. The Pound has come under selling pressure recently ever since minutes of the Bank of England’s June meeting last week, flagged prospects of another round of stimulus through quantitative easing (QE) and that UK interest rates are likely to remain at their record low 0.5 percent for the rest of 2011. GBPUSD fell to lows of 1.5912 from the open of 1.5960.
The Yen weakened against the Dollar in Asian trading. USDJPY continued to advance as the greenback is benefitting from the debt concerns over Greece, peaking at 80.87 from the open level of 80.31. Meanwhile EURJPY was rangebound throughout the session opening at 113.96 and closing at 114.04. Neither currency is in demand ahead of the Greek parliamentary vote on Wednesday as markets are jittery and are in a wait-and –see mode.
The Australian Dollar plunged to a 11-week low against the USD, as concerns about the Greek debt crisis and weak commodities weighed down higher risk currency such as the Aussie, which is also a commodity-linked currency. AUDUSD fell to 1.0410 from 1.0479. Weaker than expected trade surplus data from Australia’s major trading partner, New Zealand, did not help the Aussie.
Gold reached its lowest level of the month as Asian markets opened, touching $1,497.73. The strong US dollar weighed down the precious metal, as the two have an inverse relationship. After falling, prices then held as steady as gold is supported by active buying on the physical market in Asia. Investors are cautious and await the results of the Greek vote on austerity measures this Wednesday.
Note: Daylight Saving Time is in effect for GMT