American focus: euro fluctuated against the dollar

The euro fell against most of its major counterparts after Spanish bond yields surged and Fitch Ratings said the nation won’t meet budget-deficit goals, adding to concern Europe’s debt crisis is worsening. The 17-nation currency fluctuated against the dollar after weakening for a fourth day as Spain’s 10-year bond yields reached a euro-era record. The yield on 10-year Spanish debt touched 6.83 percent, a euro-era record. Similar-maturity Italian bond yields rose 14 basis points, or 0.14 percentage point, to 6.17 percent, after reaching as high as 6.30 percent.

Fitch also cut its rating on 18 Spanish banks, citing concern about further loan deterioration. The company cut Spain’s long-term credit rating to BBB on June 7, two levels from junk status.

The yen weakened versus most peers after the International Monetary Fund said it was overvalued. Japan should consider additional monetary stimulus, including buying longer-maturity government bonds and private securities, the IMF said in a report today.

The BOJ, which starts a two-day policy meeting on June 14, refrained from adding to monetary stimulus last month after expanding its asset-purchase program in April. Japanese Finance Minister Jun Azumi earlier this month pledged to take “decisive” action on currencies after the yen climbed to 77.66 per dollar, the strongest since February.

The Dollar Index, which Intercontinental Exchange Inc. uses to track the greenback against the currencies of six major U.S. trading partners, was little changed at 82.490 after falling as much as 0.2 percent.