Euro weakens as default threat grows

STOCKS fell and the euro weakened yesterday as fears increased that Greece will default and eurozone finance ministers put off any decision about giving them the latest €8 billion tranche of their bailout loan.

The mood was all the more pessimistic because Greece admitted that it will not meet the deficit reduction targets at the end of the year. They believe it will be 8.5% compared to the 7.6% target.

Finance Minister Michael Noonan said he did not believe that Greece failing to meet targets would affect Ireland. “We are very separate now in our economic progress and in our vital statistics. I do not think there is any crossover effect”, he said as he arrived for yesterday’s meeting in Luxembourg.