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EUR/USD slips amid fresh fears over euro zone periphery

Published 02/04/2010, 02:56 AM
EUR/USD
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The euro slipped against the U.S. dollar on Thursday, nearing a 7-month low, amid new fears over the fiscal health of the euro zone periphery. 

EUR/USD shed 0.2% shortly before the start of the European trading session, hitting 1.3865. 

The pair was likely to find short-term support at 1.3852, Monday's low, and long-term support at 1.3747, the low of June 16. It was likely to find resistance at 1.4026, Wednesday's high. 

On Wednesday, the European Union's economics commissioner said fears had spread beyond Greece to other euro zone countries, chiefly Spain and Portugal, where public finances were spinning out of control. 

"In these countries we have seen a constant loss of competitiveness ever since they joined the eurozone," said Joaquin Almunia. "The external financing needs are quite big." 

Banks in Spain and Portugal dropped heavily in late trade on Wednesday as the concerns over the countries' economic health swept the markets.

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