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Forex - EUR/USD tumbles to 2-month low as debt concerns weigh

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Forex Pros - The broadly weaker euro tumbled to a two-month low against the U.S. dollar on Monday, amid ongoing worries over the possibility for debt restructuring by Greece.

EUR/USD hit 1.4042 during late Asian trade, the pair's lowest since March 28; the pair subsequently consolidated at 1.4044, tumbling 0.79%.

The pair was likely to find support at 1.3868, the low of March 17 and resistance at 1.4237, the high of May 17.

On Friday, Fitch Ratings downgraded Greek sovereign debt ratings by three notches, saying a "soft" restructuring of the country's debt by European Union policy makers would be considered a default.

Standard & Poor's also downgraded its outlook on Italy's A+ sovereign-debt rating from stable to negative because of risks in the government's plan to cut its debt.

The results of Sunday elections in Spain also weighed on the single currency, as the ruling Socialists lost to conservatives in local and regional elections, raising concerns about how the country will address its debt problems.

The euro was also down against the pound, with EUR/GBP shedding 0.49% to hit 0.8677.

Later in the day, the euro zone was to publish preliminary data on manufacturing and service sector growth while France and Germany were to publish individual reports.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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