1st November 2011
The euro has dipped in forex trading today (November 1st) following an unexpected call from the Greek people for a referendum on the latest bailout plans.
Should the referendum result in the Greek people rejecting the latest bailout plans then the possibility of a disorderly default becomes much more likely for the country - an eventuality that would seriously hinder performance of the single currency in the months to come, Reuters reports.
"The Greek referendum is a real curve ball, nobody saw it coming and it injects a lot of uncertainty," Steven Saywell, head of FX strategy at BNP Paribas, told the news provider.
As a result, investors are now shying away from the euro and its value has fallen by more than one per cent against both the Japanese yen and the US dollar.
This latest development follows a prolonged period of strength for the single currency, with the euro achieving a seven-week high late last month.
It was bolstered by what was perceived as a successful meeting of European leaders in regards to thrashing out a solution to the region's ongoing financial problems.
Posted by Andrew Johnston
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