Forexpros – The euro extended losses against the U.S. dollar on Wednesday, falling below the 1.30 support level, as concerns over a possible Greek default or exit from the euro zone escalated.
EUR/USD hit 1.2963 during European afternoon trade, the pair’s lowest since Monday; the pair subsequently consolidated at 1.2971, shedding 0.27%.
The pair was likely to find short-term support at 1.2954, Monday’s low and a three-month low and resistance at 1.3006, the session high.
Concerns over Greece’s future in the single currency bloc mounted on Tuesday after Alexis Tsipras, the head of Greece’s second-biggest party Syriza, declared that Greece’s financial aid package is null and void, and called for a moratorium on Greek debt payments.
Tsipras was to hold talks with Greece’s leading political parties later in the day, as attempts to form a government continue, but a second round of elections is looking increasingly likely.
Earlier Wednesday, the yield on Spanish 10-year bonds rose above 6%, amid investor concerns that the debt crisis could spread from Greece.
Investors also remained concerned over whether French president-elect Francois Hollande’s focus on growth rather than austerity measures as a means to tackle the crisis could spark tensions with Germany.
The euro was hovering just above a three-and-a-half year low against the pound, with EUR/GBP inching up 0.01% to hit 0.8049 and fell to a three-month low against the broadly stronger yen, with EUR/JPY tumbling 0.76% to hit 103.08.
Also Wednesday, official data showed that German exports and imports both hit record highs in March, fuelling hopes that the euro zone’s largest economy is weathering the effects of the debt crisis.
The Federal Statistics Office said exports increased by 0.9% to EUR91.8 billion, while imports rose 1.2% to EUR78.1 billion.
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