Euro hits 11-year low; Asia shares slump


HONG KONG: The euro sank to a new 11-year low and Asian equities retreated after an anti-austerity party won Greece’s general elections, throwing its international bailout into doubt and raising fears it could leave the eurozone.

Asian stock markets, which surged Friday in response to the ECB move, turned negative Monday.

Tokyo lost 0.53 percent, Hong Kong gave up 0.17 percent, Shanghai fell 0.29 percent and Seoul shed 0.11 percent. Sydney was closed for a public holiday.

With the last few votes still to be counted, the far-left Syriza party was close to winning an outright majority in Sunday’s polls, increasing the chances it will take a hard line on rowing back austerity measures.

The group had campaigned on renegotiating the European Union-International Monetary Fund bailout that imposed strict spending and taxation rules on Athens.

The possibility of Greece defaulting on its debt repayments is likely to spark renewed fears the country could be forced to leave the eurozone.

British Prime Minister David Cameron was among the first world leaders to react to the result, tweeting that it “will increase economic uncertainty across Europe.”

The news hit the single currency in early Asian trade, diving at one point to $1.1088, its lowest level since September 2003, before recovering slightly to $1.1180. That compares with $1.208 Friday in New York.

It was also at 131.55 yen compared with 132.03 yen on Friday.

The dollar was at 117.75 yen compared with 117.80 yen in New York

The single currency was already suffering heavy selling after the European Central Bank on Thursday unveiled a bigger-than-expected bond-buying program aimed at kickstarting the eurozone economy and fighting off deflation.


Please follow our commenting guidelines.

Comments are closed.