Euro Bleeds with Portugal Downgrade

The euro declined versus all of the 16 main traded currencies this Wednesday as Portugal started to raise concerns strongly, after an important financial agency cut its credit rating for the first time, showing that hard times are still to come for the Eurozone.

Fitch Ratings lowered Portugal's credit rating one step to AA-with a negative outlook, considering more credit rate cuts to come during this year or the next, if the southern European nation's doesn't find efficient methods to boost its economy and tighten its budget deficit , causing an immediate impact in the euro, allowing the greenback to touch the highest price versus the EU's single currency in 2010. Fitch's statements also brought risk aversion to strong levels today, allowing refuge currencies to be the best performers in forex markets today, including the Swiss franc and the Japanese yen.

Greece now has an "official" partner on its struggle to adjust its natonial accounts, and even if Portugal's economic difficulties are already well known by traders, the official credit rate cut by Fitchs certainly brought more pessimism to the region, making the euro to move towards the worst quarterly performer since 2008.

EUR / USD traded at 1.3325 as of 02:14 GMT from a previous intraday rate of 1.3427.