Tags: ECB | Member | Not Save | Greece

ECB Member: We Will Not Save Greece

Monday, 21 Dec 2009 12:57 PM

The euro fell against the dollar Monday on heightened concerns about the huge debts of certain European countries, notably Greece.

In London morning deals, the single currency fell to $1.4327 from $1.4343 in New York late on Friday.

Against the Japanese currency, the dollar rose to 90.42 yen from 90.40 yen on Friday.

The dollar was supported against the euro by recent upbeat US economic data that contrasted with gloomy news from Europe, where worries are growing that government debt problems may threaten an economic recovery, dealers said.

The European Central Bank has no plans to bail out debt-suffering Greece and expects the eurozone member to sort out its finances on its own, an ECB governing council member said in an interview published on Monday.

"One has to be very clear: The ECB has no mandate or intention to take into account the situation of a specific country, especially not with regard to public finances," Ewald Nowotny told The Wall Street Journal.

"Our baseline scenario is that the Greek government will be able to fulfill its promises," Nowotny, who is head of the Austrian central bank, said in an interview conducted on Friday.

Greece's sovereign credit rating has been downgraded this month owing to its growing public deficit and debt.

Greece's debt is now estimated at 300 billion euros ($430 million), three times the size of Germany's, which is the biggest eurozone economy.

In the US meanwhile, home sales and durable goods orders are among the economic indicators due to be released this week and digested by the foreign exchange market.

The greenback got a boost in early trading Monday from safe-haven demand due to increased tensions in the Middle East, after Iranian troops occupied an Iraqi oil well in a disputed border area from Friday until Sunday, dealers said.

It was the first serious incident between the two neighbours since the US-led invasion of 2003 that toppled Saddam Hussein, whose forces fought a 1980-1988 war against Iran.

Market players will meanwhile be looking at Wednesday's minutes of the Bank of England's most recent policy meeting for any clues on when it will exit its emergency measure of flooding markets with cash, known as quantitative easing.

They largely overlooked fresh data out of Japan showing the world's second largest economy logged a trade surplus for a 10th straight month in November, helped by recovering demand from China.

© AFP 2017

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The euro fell against the dollar Monday on heightened concerns about the huge debts of certain European countries, notably Greece. In London morning deals, the single currency fell to $1.4327 from $1.4343 in New York late on Friday. Against the Japanese currency, the...
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