Euro Slides to Weakest Since 2006 on ECB, Greece as Dollar Gains

The euro fell to the weakest in almost nine years against the dollar amid speculation the European Central Bank is moving closer to large-scale bond purchases. The shared currency slid as much as 1.2 percent today after President Mario Draghi last week gave his clearest signal the ECB will start quantitative easing. The euro also weakened as Greece began an election campaign that may see victory by an anti-austerity party. A gauge of the dollar headed for its highest ever close as the Federal Reserve moves toward raising interest rates. New Zealand’s dollar and South Africa’s rand fell along commodity currencies “The reasons to be selling the euro were pretty clear over the weekend: Draghi being a step closer to QE and deepening concerns about the Greek political situation,” said Sean Callow, a currency strategist at Westpac Banking Corp. in Sydney. “The euro was so close to such a keenly watched round number as $1.20 that we didn’t need any fresh news to tip us over the cliff.” The euro dropped 0.5 percent to $1.1945 as of 6:58 a.m. in London after sliding to $1.1864, the weakest level since March 2006. The shared currency fell 0.6 percent to 143.82 yen after declining to 143.16, the lowest since Nov. 11. The dollar was little changed at 120.33 yen. To contact the reporters on this story: Garfield Reynolds in Sydney at greynolds1@bloomberg.net; Kevin Buckland in Tokyo at kbuckland1@bloomberg.net