Portuguese Parliament Sends Euro (FXE) Lower

The Euro (EUR) fell further against the US Dollar (USD) and most of its major counterparts today, after Portugal's parliament rejected government's plans for austerity measures. The Euro was already on a slide when the news hit the market, which made the currency to extend the losses. As many analysts expect, the decision could eventually force the current government to resign in the middle of an already very difficult process of debt structuring, which will add to the uncertainty of the debt crisis in Portugal and, to some extent, in other troubled Euro zone economies. At the same time, however, the Euro can not weaken a lot more, because of the recent repeating hints by the ECB about an imminent rate hike. The EUR/USD fell from 1.4214 all the way to low 1.4080s, where it currently trades, although the bias remains slightly to the downside. The European currency fell significantly against the Japanese Yen (JPY) and the Canadian Dollar (CAD) also, as the EUR/JPY fell from 115.25 to 113.90s, and the EUR/CAD pair dropped from 1.3930 to 1.3820.