Euro sinks further against US dollar

| May 19, 2010 | 0 Comments
Euro sinks further against US dollar

The euro has fallen against the US dollar and the Japanese yen after Germany banned risky bets on bonds, stocks and credit protection, until March next year.

The ban, imposed by the German Government, will apply to the country’s 10 most important financial institutions, and is designed to stop the short-selling of euro Government bonds.

Short-selling has been blamed for the recent stock market falls, while many believe it worsened Greece’s debt crisis by making it more expensive for the country to borrow.

The euro fell below $1.22 for the first time since April 2006, while it lost over 2% against the yen.

Stocks, as well as the euro, have also been hit over recent weeks as investors are nervous that tough austerity measures introduced in many euro zone nations, will hamper growth.

The euro had already hit a four-year low against the dollar earlier this week, taking its losses for the year to date to over 15%.

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