Euro clatters to four-month low against US dollar

The euro has hit a four month low and is likely to collapse even more as squabbling politicians in Greece face another election after failing to agree who will lead a government.

The election in June could well herald the country’s departure from the eurozone as the question to voters is not so much who to elect but whether they should vote for or against austerity measures and sticking with the euro.

The underlying problem for Greece is traditional economic tools to manage a faltering economy simply are not available because the government is not in control of the country’s currency exchange rate.

Interest and exchange rates are governed by richer countries in the eurozone, and where Greece could have devalued the drachma in the past to ride out an economic storm, the option is no longer available.

Departing the eurozone for economic obscurity is an option – but while the will-they-won’t-they drama plays out, the economic indecision that has plagued Europe for months continues to damage the euro.

France reckons that the country will have to pay €66 billion if Greece leaves the eurozone.

The big question for new president Francois Hollande and Angela Merkel in Germany is whether the financial damage is easier to bear if Greece stays in the euro.

The US dollar and the Pound have profited from the euro debacle and are likely to strengthen, but in the long run Europe is a big trading partner for both.

Certainly the fear for the UK and the Pound is the euro will drag the economy down even further.

Putting a price on the euro against the dollar and pound is difficult as the gap widens by the hour.

The euro stands at €1.2747 (Up 0.14%) against the dollar and 0.7998 (Up 0.48%) against the Pound, while the Pound v dollar rate is $1.5938 (Down 0.35%).

Stay Connected

Latest News

Economic Impact Payments for US Expats

The US government is paying millions of dollars into the bank accounts of American expats as coronavirus economic impact payments and this guide will...

HMRC Explained

HMRC is short for Her Majesty’s Revenue and Customs. The HMRC collects the taxes and customs duties that the British government spends...

Difference Between Residence and Domicile

For British expats, their residence and domicile determine how much tax they are likely to pay, both in the country where they...

QROPS, Qualifying Recognised Overseas Pension Scheme

QROPS is a type of pensions that were designed to cater for the needs of British pension holders that move out of...

Where Do British Expats Live?

More than 5.5 million people from Britain live overseas and leave the country at a rate of around 2,000 a week.

Living In The Philippines, A Guide for Expats

Brilliant weather, a low cost of living and friendly, English speaking people makes The Philippines a popular destination for British expats.


Please enter your comment!
Please enter your name here