Analysis – Fresh dollar funding strains bode ill for euro
LONDON (Reuters) – An increasingly difficult search for dollar funding by euro zone financial institutions will gradually push the euro lower but only a major event such as a sovereign default or a break-up of the currency bloc would trigger a precipitous fall. The euro has so far held up well against the dollar, trading around $1.35 and still 1 percent higher on the year, despite the spreading euro zone debt crisis. But selling of euro zone assets by spooked investors is likely to see increased demand for the safe-haven dollar. …