Forexpros – The euro tumbled to a six-week low against the yen on Monday, as concerns over sovereign debt levels among indebted euro zone states and in the U.S. saw investors shun riskier assets.
EUR/JPY hit 103.23 during European afternoon trade, the pair’s lowest since October 10; the pair subsequently consolidated at 103.52, shedding 0.45%.
The pair was likely to find support at 102.55, the low of October 7 and resistance at 104.28, Friday’s high.
Earlier in the day, the spread between 10-year Spanish bond yields and their German counterparts widened as investors remained jittery despite the election of a new Spanish government which was expected to push through drastic austerity measures.
The euro remained under pressure after rating’s agency Moody’s said a rise in French government debt yields and weaker growth prospects could be negative for the outlook on the country’s credit rating.
Meanwhile, the failure of a U.S. congressional “super committee” to agree on a package of measures to slash USD1.2 trillion off the U.S. deficit over the next 10 years sparked fresh selling in riskier assets.
The euro was also lower against the U.S. dollar, with EUR/USD shedding 0.41% to hit 1.3468.
Also Monday, official data showed that Japanese exports fell in October, down for the first time in three months, as the persistently strong yen and concerns over a slowdown in global growth hit demand.
Exports fell 3.7% last month from a year earlier, while imports were up 17.9% year-on-year, bringing the trade balance to a deficit of JPY273.8 billion, the first deficit in two months.
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