Euro Drops to Six-Week Low Versus Dollar Before Ministers Meet on Greece

The euro fell against all but two of its 16 most-traded counterparts, reaching a six-week low against the dollar, on concern Greece may have to restructure its debt and the nation’s problems may spread in the region.

The 17-nation currency weakened before European finance ministers meet next week to discuss further support for Greece as the nation’s cost of borrowing hovers at almost record levels. The dollar gained versus most peers this week as stocks and commodities fluctuated. South Africa’s rand was the worst performer among major currencies, dropping the most in 18 months against the dollar as unemployment jumped.

“The overall prevailing theme is the European debt market mood, and the euro has been caught up in that this week,” said Nick Bennenbroek, head of currency strategy at Wells Fargo & Co. in New York. “There’s been a role reversal in the context of recent events; the short-term inclination of the markets, instead of being to sell the dollar, is to sell the euro.”

The euro dropped 1.4 percent to $1.4118, from $1.4316 on May 6, in its second weekly loss versus the greenback. It touched $1.4067 yesterday, the lowest level since April 1. The shared currency fell 1.2 percent to 114.06 yen and touched 113.52, the strongest level since March 18, when Group of Seven central banks sold yen in the currency markets to stem its surge after an earthquake and tsunami.

The dollar rose 0.2 percent to 80.79 yen, from 80.63.