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Euro dips after Greek elections

January 26, 2015

Greece's Syriza party has won an historic victory in Sunday's parliamentary elections, taking more than 36 percent of the vote. Concerns are now growing these results could lead to renewed economic instability in Europe.

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Syriza Unterstützer Feier 25.01.2015 Athen
Image: Reuters/A. Konstantinidis

The euro dipped to an 11-year low on Monday after Greece's anti-austerity opposition party won a sweeping victory in national elections.

The European common currency fell to $1.1098 to the US dollar on the vote, its lowest level since September 2003, before recovering to $1.118, down 2 percent from last week.

Greece's left-wing Syriza party has vowed to end unpopular austerity policies and renegotiate the terms of Greece's 240-billion-euro bailout with the European Union and the International Monetary Fund. Its leader Alexis Tsipras promised to end "humiliation and pain" that Greece has suffered since the 2010 bailout, when the country endured harsh spending cuts.

The possibility of Greece defaulting on its debt payments has sparked concerns the country could be forced to leave the eurozone. But market analysts expect Tsipras to make compromises to avoid the so-called "Grexit."

The election was a second blow since last week for the euro, still reeling after the European Central Bank announced its bond-buying stimulus program.

European shares are also lower, with Germany's Dax dipping 0.5 percent at the start of trading and the FTSE100 in the UK down 0.3 percent. The Greek bluechip index ATG is down by over 5 percent.

el/ng (AFP, AP, Reuters)