Exchange traded funds that follow the movement of the euro versus the U.S. dollar have seen losses accelerate on signs European leaders aren’t doing enough to stem the debt crisis.
CurrencyShares Euro Trust (NYSEArca: FXE) is down about 7% over the past month.
The euro fell to more than a decade low versus the Japanese yen on Monday amid wrangling among officials over increasing the size of Europe’s bailout fund, Bloomberg reported.
Incoming European Central Bank President Mario Draghi said a lack of confidence may be among the reasons for lenders’ “funding problems.”
“The persistent debate within the European Union really undermines the possibility of some sort of concrete progress made on increasing the bailout funds for the region and preventing contagion,” added Kathy Lien at GFT Forex in the Bloomberg report. “The move you’re seeing in the euro is a reflection of investors disappointment over lack of progress.”
CurrencyShares Euro Trust
Read the disclaimer; Tom Lydon is a board member of the funds for Rydex|SGI.