Traders make record bet on falling euro

Traders are making record bets that the value of the euro will fall against that of the US dollar.

A total of almost £5 billion has been put against the currency.

Analysts have speculated that the high bets have arisen due to the euro's unstable position.

This is as a result of Greece and other countries' spiralling debts.

Spain and Portugal, which have also incited doubt over the state of their national finances, have attempted to smooth things over, but the euro reached an eight-month low against the dollar last week (February 5th) and is barely showing signs of recovery.

Thomas Stolper, an economist at Goldman Sachs, commented: "Behind this intense focus on Greece obviously is the long-standing unresolved issue of how to enforce fiscal discipline in a currency union of sovereign states."

One euro bought $1.37 at midday today (February 9th), continuing the overall decline of the currency from a high of $1.5 in November of last year.

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Posted by Thomas Smith