Euro falls against dollar on worries about Europe

AP News
Posted: Apr 23, 2012 3:42 PM
Euro falls against dollar on worries about Europe

Economic and political turmoil in Europe pushed the euro lower against the dollar Monday.

The euro fell to $1.3144 in late trading from $1.3215 late Friday.

The European Union said that even with spending cuts, debt in countries that use the euro rose to 87.2 percent of gross domestic product in 2011 from 85.3 percent in the previous year.

A separate survey found that the euro zone's manufacturing and services sectors unexpectedly fell in April.

In France, President Nicolas Sarkozy lost the first round of the country's presidential election to Francois Hollande, a harsh critic of the spending cuts that the region has adopted. Traders are worried that a leadership change in France could derail or slow efforts to solve Europe's debt crisis.

"It took Europe a very long time to get where they are at now and to have to start from square one again would cause more problems than solutions," Kathy Lien, director of currency research for the currency trading company GFT, wrote in a note to clients.

Traders were also concerned about political problems in the Netherlands. The country's prime minister and his cabinet resigned after they failed to agree on a new cost-cutting plan.

In other trading Monday, the British pound rose to $1.6125 from $1.6106 late Friday. The dollar rose to 0.9136 Swiss franc from 0.9092 Swiss franc

The dollar fell to 81.13 Japanese yen from 81.58 yen and to 99.16 Canadian cents from 99.32 Canadian cents.