By CountingPips.com
The European common currency declined sharply today in forex trading as Portugal’s credit rating was downgraded to “AA-” by the ratings agency Fitch Ratings. Portugal’s credit rating was “AA” before today’s action. The downgrade was 
prompted on concerns of the country’s high debt obligations and has added more negative sentiment for the euro on top of Greece’s well publicized debt problems.
EU leaders are scheduled to meet for a Eurozone summit on Thursday and Friday and will be faced with renewed pressure to come up with a European solution for Greece’s troubles or turn to the IMF for help after the Portugal downgrade. German Chancellor Angela Merkel has said that the summit won’t lead to a decision on Greece’s situation while other EU leaders are pressing for a framework that could lead to a solution.
News out of the EU summit will likely play a pivotal role in the euro’s direction, especially in the short-term.
EUR/USD 4-Hour Chart – The EUR/USD currency pair fell to a fresh 10-month low-point today as the pair touched its lowest level since May 7th, 2009 at the 1.3332 exchange rate. The EUR/USD had risen to the 1.3817 exchange rate as recently as March 17th before declining over the past week and accelerating lower today. Today’s action has seen the euro fall by over 100 pips to the dollar while the euro touched a fresh all-time low versus the Swiss franc.
