The euro edged lower against its most major counterparts on Monday as caution prevails ahead of a European Union summit starting Thursday that could discuss specific steps to ease the stress in Spain's banking sector.
The euro also declined before Italy and Spain auction securities tomorrow. Italy is scheduled to sell inflation-linked securities maturing in 2016 and 2026 as well as 3 billion euros of zero-coupon bonds. Spain will also offer three and six-month bills.
Greece's new Prime Minister Antonis Samaras will be unable to fly to Brussels for this crucial summit, as he is recovering from an eye surgery. The troika was expected to make a quick visit to Athens today but postponed it due to Samaras' poor health condition.
The leaders of Germany, France, Spain and Italy on Friday vowed to set aside 130 billion euros for measures to support growth, but they gave no indication of taking up common liabilities such as eurobonds.
The euro that ended Friday's trading at 1.2567 against the US dollar fell to a 12-day low of 1.2499. The next downside target level for the euro-dollar pair is seen at 1.245.
Against the yen, the euro slipped to a 5-day low of 100.07, compared to Friday's close of 101.13. If the euro-yen pair weakens further, it may likely target the 99.5 level.
The euro dropped to a 12-day low of 1.2835 against the Canadian dollar from Friday's close of 1.2879. On the downside, 1.280 is seen as the next target level for the euro.
The euro touched 0.8028 against the pound, down from Friday's close of 0.8066. The near term support level for the euro-pound pair is seen at 0.800.
There are no major economic reports due in the European session.
The U.S. new home sales for May is slated for release in the New York morning session.
Source: RTT News