Euro currency exchange rate suffering

The currency exchange rate for the euro is suffering against the dollar and the pound.

Concerns regarding eurozone banking stress tests are thought to be affecting the currency, the Financial Times reported.

According to the paper, analysts have surmised that the tests, which are due to be published on Friday July 16th, could have negative results.

Geoffrey Yu from UBS told the news source: "In the near-term, the euro could suffer from any disappointment triggered by the stress tests."

He added: "Furthermore, with short positions in the euro now cut so sharply, the scope for investors to enter new short positions has increased substantially, leaving the euro especially vulnerable to a possible shift in sentiment."

The euro was down against the dollar this morning, trading at $1.25 at 08:45 BST.

It also dipped against the pound to buy £0.85.

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Posted by Chris Barber