The once-mighty euro, a currency that humbled American tourists in its day, has sunk to a 13-month low against the dollar. Greece’s impending bailout apparently isn’t settling nerves in the eurozone, which includes other major economies that look a little wobbly as of late.
Spain, with its 20 percent unemployment (a figure that has doubled since 2008), and Portugal have been causing economists and analysts some concern. —PZS
AP via Google:
Analysts don’t see an end to the euro’s fall. UBS AG, which had a three-month price target of $1.30, says its euro forecast is under review. Morgan Stanley, which has a euro forecast of $1.24 by the end of the year, is considering lowering its target.
“There’s no easy way to fix the debt problem in Europe,” said Morgan Stanley currency strategist Ron Leven. “It’s very difficult to see how Greece can dig itself out of its debt problem.” There may have to be a restructuring of Greece’s debt beyond the bailout, he said. European banks, which are big holders of Greek bonds, would take a big hit.