THE EURO HAS fallen to an 11-month low against the dollar.
Two credit ratings agencies (Moody’s and Standard & Poor’s) warned recently that they could downgrade the ratings of EU member states – a warning which been encouraging investors to turn to the seemingly less-risky dollar.
Investors have also yet to be convinced that EU moves to increase stability and ease the current crisis will work.
Yesterday, the US Federal Reserve warned that market turbulence amid Europe’s ongoing financial concerns pose a big risk. Reuters reports that the Fed held its final policy meeting of 2011 yesterday and failed to announce any new measures aimed at stimulating growth, prompting US stock markets to fall slightly.
Asian markets also fell slightly lower overnight on the back of the US market moves and the Fed Reserve meeting.
This morning, Japan’s Nikkei is down 0.39 per cent, Hong Kong’s Hang Seng dropped 0.48 per cent and South Korea’s Kopsi is down 0.34 per cent.
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