Euro Rallies to New Lows

The euro was rallying to new lows today, reaching the lowest level since 2010, on concerns that regional governments of Spain would meet obstacles in reaching capital markets.
Artur Mas, the President of Catalonia, asked Spanish central government to aid regions access funding. Deputy Prime Minister Soraya Saenz de Santamaria said that the government is reviewing “with all caution” requests from regional governments to help them regain access to capital markets. Officials stated that Catalonia is realizes its budget program “strictly” and will fulfill its commitments.
That was just one of many Spain’s problems. Standard & Poor’s downgraded five Spanish banks, following the cut of Spain’s sovereign credit grade. Earlier, Moody’s Investor Service also decreased ratings of several bank in Spain. It is obvious that the eurozone crisis is not limited to Greece alone and it may be spreading across all Europe.
EUR/USD traded at 1.2515 as of 18:51 GMT today after falling earlier from 1.2532 to 1.2496 — the lowest rate since July 6, 2010. EUR/JPY was down from 99.78 to 99.66, following the earlier advance to 100.31. EUR/GBP was flat near 0.7993.

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