(Bloomberg) — The and declined after European Union finance ministers failed to agree on joint measures to cushion the region’s economy against the impact of the coronavirus crisis.
The common currency fell against most Group-of-10 peers, while benchmark debt yields in Italy, seen as the most vulnerable economy to the pandemic, jumped to a three-week high. German bunds, a haven asset, rallied in contrast following the failure after a teleconference that lasted more than 16 hours.
“This is negative for the periphery who are suffering the most from the crisis,” said Pooja Kumra, senior European rates strategist at Toronto-Dominion Bank. “These mutual decisions will be a struggle and could drag.”
Markets had been expecting a package of stimulus measures totaling around half a trillion euros, involving support from the European Stability Mechanism, the European Investment Bank and the European Commission.
The euro dropped as much as 0.6% to $1.0830, while Italian 10-year bond yields jumped 18 basis points to 1.80%, the highest level since March 19. yields dipped five basis points to -0.36%.
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