The euro took another beating this morning after the eurozone tacked another round of weak economic data onto its ever-growing list of disappointments.
Institute's business climate index was reported weaker-than-expected -- it dropped to levels not seen in almost two years. Declining sentiment just compounds the other disappointing numbers out of the eurozone the last few months. The euro tumbled to new six-month lows against the dollar and near three-month lows vs. the yen in reaction to the Ifo data.
The euro traded most recently for $0.8682, a broad step down from $0.8764, where it closed trading yesterday. Near levels not seen since the end of March, the euro slipped to 106.31 yen per euro, well over a yen below yesterday's closing price of 107.46 yen per euro.
Despite the continuing stream of data indicating a slowdown in the eurozone, the
European Central Bank
is reluctant to cut interest rates again, traders say. The ECB has lowered rates only once since the global slowdown began, cutting the key rates by 25 basis points in a
surprise move on May 10. The U.S.
Fed has reduced interest rates by 250 basis points this year.
The dollar is down just slightly to the yen this morning, trading most recently for 122.45 yen per dollar, from 122.64 yen at Monday's close.
The British pound is following its neighboring euro down against the dollar today. The pound traded most recently for $1.4290, over a full cent below yesterday's closing price of $1.4399. It's being questioned if the pound is ready to join the European Union in a single currency. While the British and eurozone economies seem to be in synch, a vast majority of Britons do not support merging the pound into the euro.
The U.S. coin is the winner in the dollar bloc today. The Australian dollar slipped to $0.5236 from $0.5265 yesterday. The U.S. currency climbed in value against the Canadian dollar to C$1.5406 recently, up from C$1.5367 at last close.
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