Euro sinks amid new jitters over sovereign debt

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TOKYO: The euro fell against the dollar and yen in Asia on Monday with Italy's debt under the spotlight as continued worries about Greece shook confidence in the eurozone.

The euro bought $1.4118 in Tokyo morning trade, down from $1.4195 in New York late Friday. It also slipped to 114.01 yen from 114.10.

The dollar firmed to 80.77 yen from 80.34 yen.

"As has been so often the case recently, eurozone sovereign debt problems knocked investor risk-appetite lower," said John Kyriakopoulos, currency strategist at National Australia Bank.

Moody's ratings agency has put the ratings of 16 Italian banks on review for possible downgrade and changed the outlook for a further 13 banks to negative from stable.

The move sparked fresh concerns over European debt problems and sent stock prices plunging on Friday amid concerns of contagion from the Greek crisis.

"The worsening in investor risk-appetite encouraged "safe haven demand" for the Swiss franc, Japanese yen and US dollars, Kyriakopoulos said in a note.

Currency rates this week will be swayed by the Greek parliamentary vote on the government's new austerity measures critical to securing another bailout package and by production data from China, Britain and the United States, said analysts.

Given the measures are unpopular among the public, concerns are growing that Greek lawmakers may not make their support clear until the last minute or perhaps oppose the measures, Junichi Ishikawa, forex analyst at IG Markets Securities, told. (AFP)