So much turkey-related news, it feels like Thanksgiving. The euro is falling sharply against the dollar and other major currency players because of political distress in Turkey.

A verbal dispute between Turkey's President

Ahmet Necdet Sezer

and Prime Minister

Bulent Ecevit

caused a major political riff yesterday, sparking a massive downturn in the Turkish markets and poisoning the interests of international investors. The adverse affects has "definitely put a lot of downward pressure on the euro," said Lara Rhame, an economist at

Brown Brothers Harriman

. It brings to question two key areas: the underlying question of expansion of the euro to countries not already using the single-currency and the stability of a currency across multiple governments, Rhame said.

The euro was recently trading for $0.9072, a far drop from yesterday's closing price of $0.9217. A large part of today's decline in the euro/dollar is due to technical selling related to the U.S. markets being closed yesterday. "These moves down are temporary," Rhame said, nothing that analysts believe "anything below $0.92 is a good buy."

On the back of the tumbling euro, the British pound is slipping against the dollar. While it is still "splitting the difference between the euro and the dollar," according to Rhame, the fall in the euro is winning and pulling the pound down against the dollar. It was recently trading at $1.4365 , down a penny from $1.4464 at the close of trading yesterday.

Japan's own political bruhaha continues to upset the overseas markets, as questions persist about the remaining days of Prime Minister

Yoshiro Mori's

tenure. "The question seems now to be not if he will step down, but when he will step down," Rhame said. Still, the strength of the recent repatriation of funds throughout the month of February by Japanese corporations is playing a stronger hand against the dollar today. It was recently trading for 115.36 yen, down from yesterday's close of 116.04 yen per dollar.

The yen is also making strong strides upward against the vastly weakened euro. With significantly more repatriated funds coming out of Europe than out of the U.S., according to Rhame, the general weakening of the euro is pushed down further against the yen. The euro was recently trading for 104.73 yen per euro, down strong from yesterday's close of 106.88 yen.

The major data for the key currency players this week will likely be tomorrow's data on the Consumer Price Index. "Another ugly inflation number could really bring to the forefront whether or not the U.S. can recover" from its current economic slowdown, said Rhame. This could provide significant movement in the markets tomorrow.

The U.S. dollar, on general strength from its movement against the euro, is firming against both the Australian dollar and the Canadian dollar. The Aussie buck was recently at $0.5223, down from $0.5300 at yesterday's close. The U.S. currency was recently trading for C$1.5348, up marginally from C$1.5342 where it closed Monday.

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