Monday saw the common currency of the European Union drop to its lowest value in 14 months against the U.S. dollar in the aftermath of a weekend bailout and its conditions issued to Cyprus, Bloomberg reports.
Euro zone finance ministers persuaded Cyrus president Nicols Anastasides to agree to bank deposit charges to raise 5.8 billion euros as part of a bailout agreement. The euro also fell to its lowest value in two weeks against the monetary unit of Japan as concerns mounted about the regional economy.
"There's concerns about the dangerous precedent that this sets in terms of other so-called depositors guarantees," Asia-Pacific research head Annette Beacher with TD Securities Inc. in Singapore told the news source on Monday. "It's the de-facto break-up of the euro in the fact that having money in a Cyprus bank isn't worth as much as having money in any other bank."
As it bounces back from the sovereign debt crisis, the euro zone had enjoyed a relative calm since September when the European Central Bank committed to support member countries carrying debt burdens.
Regional finance ministers are set to convene for a Monday conference call to discuss the aftermath of the bailout, according to Reuters.
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