Gold 
‘The Euro’s Sinking Fortunes
The euro is sinking fast. It has fallen 2.8% against the dollar since Friday alone, and many of the supports that buoyed it against the dollar this year have disappeared. Unless European policy makers can go beyond talk of support for the euro, it is difficult to see a recovery in the common currency’s prospects.
Until now, the euro’s resilience — it hit $1.49 in early May, up 12% from the start of the year, and was at $1.45 a week ago — could be explained by several factors. The European Central Bank has been raising interest rates, while the U.S. Federal Reserve is on hold. Risk assets like stocks and corporate credit markets were performing well, favoring the euro over the safe-haven dollar. As long as the Greek debt crisis was contained, global markets felt able to ignore it.
Currency tensions were clearest within Europe as the Swiss franc, up 11.6% against the euro since the start of April, acted as a safety valve.
But a debt crisis that is dragging in Italy, which has the world’s third-largest government bond market, poses a global threat.”
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