Euro dips below $1.25 on Greek, Spanish woes

The euro extended its slide against the dollar Friday, dipping below $1.25, under pressure from uncertainty over the future of Greece in the eurozone, and the risk of contagion from its debt crisis. The euro was at $1.2515 around 2100 GMT, down from $1.2532 at the same time Thursday. Earlier the euro had fallen to $1.2496, its lowest level since July 6, 2010. The European currency also weakened against the Japanese currency, slipping to 99.66 yen from 99.74 yen. The dollar, meanwhile, edged up to 79.64 yen from 79.59 yen late Thursday. This week, the single currency shared by 17 eurozone nations has tumbled to a series of multi-month low points on the back of concern over the plight of debt-plagued Greece. "The euro remains firmly in a downtrend, investors continue to pile into German bunds (bonds) that are returning them next to nothing and Spain's economy is continuing to be crippled by rising borrowing costs and more bank bailouts," said Simon Denham, head of Capital Spreads trading group. "The recipe is a toxic one that shows just how serious the European crisis is becoming and now that we've had the big shakeout in equities, it would seem that for now at least the selling has been exhausted." On Friday the Spanish stock market suspended trade in Bankia's plunging shares as the struggling lender asked the government for 19 billion euros ($24 billion) in what would be the largest bank bailout in the country's history. In a statement, the bank said its board had approved a recapitalization plan which will allow it "to meet all applicable regulatory requirements and confront a more adverse macroeconomic context." The dollar firmed against the Swiss currency, to 0.9596 francs from 0.9584 francs late Thursday. The pound weakened, slipping to $1.5563 from $1.5668.