Euro Falls as Risk Appetite Increases

The EUR fell 0.2 percent to $1.3745, after hitting a five-week high of $1.3817. Some analysts blamed this partially on rumors that Germany's Chancellor Angela Merkel has endorsed a proposal to eject errant countries from the eurozone. Merkel’s party said Greece should go to the IMF if it needs aid. Analysts say investors are heading to other currencies than the euro in the wake of the comments.

“We have to think about who has the instruments to push for Greece to restore its capital-markets access” if ultimately needed, said Michael Meister, chief finance spokesman for Merkel’s Christian Democratic Union (as reported by Bloomberg.com).

The euro fell 0.4 percent against the Group of 10 currencies. The dollar dropped against 11 of the 16 major currencies a day after the FOMC left rates unchanged, and as the GBP, AUD, and NZD rallied against it, indicating that risk appetite is up.