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Friday "the markets"savaged the euro.
Flirting recently as high as the $1.4848 level...it plunged from $1.4530...to $1.4337...in NYC.
All on a nasty rumor.
That apparently started on the website of Germany's DER SPIEGEL.
It claimed Greece would abandon the euro...unless there was a new restructuring of its debt.
The rumor was fed by the fact that finance ministers from leading eurozone countries are holding secret talks in Luxembourg.
The BBC has just reported that Ireland will get an interest rate cut on its debt...currently at 5.8%.
A German spokesman claimed: "There is a meeting of some finance ministers that has long been planned. Greece exiting the eurozone is not on the agenda of that meeting, and it has never been."
One economist said pressure had been mounting from Berlin. "I think the Germans have been playing hard ball for a few weeks now. If Greece does go I don't think they will be the only one."
"These scenarios are borderline criminal," PM George Papandreou is reported to have said."No such scenario has been discussed even in our unofficial contacts...I call upon everyone in Greece and abroad, and especially in the EU, to leave Greece alone to do its job in peace."
But some economists predict a continuing euro bloodbath.
"Perhaps we have crossed a rubicon," said economist Jonathan Loynes. "The knee-jerk response will probably be to push the euro lower. I believe the euro should be at parity with the dollar, not at $1.44 – I don't know what it's doing at anything like these levels."
Jean-Claude Juncker ( Pictured above), president of the "eurogroup" of finance ministers, declared that a "further adjustment program" for Greece would be on the agenda when eurozone ministers meet in Brussels on 16 May to discuss Portugal's package.
SEE ALSO LATEST:
http://www.guardian.co.uk/business/2011/may/08/greece-faces-new-bailout-deal
