Dublin, Ireland, United Kingdom (AHN) – Ireland’s debt crisis and austerity plan has fueled uncertainty among traders, causing the euro to continue its slide in value against the dollar.
The European Union’s common currency is now down to two-month lows at $1.3314; it has fallen by more than three cents this week alone. News of the proposed bailout had caused the euro to rise in trading on Monday; however, it dropped again in trading on Tuesday and has continued to drop.
Ireland’s four-year austerity plan relies on a combination of spending cuts and tax increases to save $20 billion (15 billion euros) and reduce that nation’s government deficit.
However, currency traders are skeptical, fearing that the Irish government is too optimistic and that the plan will not work. In addition, traders also fear that the debt crisis will spread to other nations within the euro zone that have high government deficits.
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