Euro falls to decade low against yen on debt fears

THE euro fell against most of its major counterparts yesterday, as concern theeurozone debt crisis may spread led investors to shun the currency before am ECB meeting today.

The 17-nation euro weakened to almost a decade low against the yen after a spokesman for EU Economic and Monetary Commissioner Olli Rehn said there was no concrete plan to recapitalise banks. Speculation about the effect of eurozone bank holdings of Greek debt has helped weaken the euro 5.5% in the past month.

“We just need to know that there’s a bold policy response that European policy makers are willing to take to avert a meltdown,” said Mark McCormick, a currency strategist at Brown Brothers Harriman & Co in New York.

Traders increased bets the ECB will lower borrowing costs today to fuel growth as the region’s debt crisis rattles markets.

Eleven of 52 economists surveyed by Bloomberg predicted the central bank will cut its benchmark rate by at least a quarter percentage point from the current 1.5%. The others expected no change.