Tuesday, September 18, 2012

Euro falls from four-month highs on Spain uncertainty

(Reuters) - The euro fell on Tuesday, succumbing to profit taking after rallying to four-month highs against the dollar and yen a day earlier, with Spain's apparent reluctance to seek a bailout unnerving investors.

The yen also ceded ground against the dollar on speculation the Bank of Japan might loosen policy after the U.S. Federal Reserve launched a fresh round of monetary stimulus last week.

Market players said rising bond yields in Spain, which hovered around 6 percent on 10-year debt, also weighed on market sentiment and added to pressure on the euro.

"If Spain steps forward (to ask for a bailout) and all of us get some clarity it would remove an element of uncertainty," said Derek Halpenny, European head of FX research in London.

"The longer we remain in this scenario the more likelihood is investor confidence will ebb away." Read More