Trichet Crushes the Euro in Forex Trading

The euro continues its headlong descent in forex trading on the currency market today. The main catalyst for today's losses for the 15-nation currency were remarks from the ECB's Jean Claude Trichet. He indicated that the ECB may actually drop rates below the current 1%. GFT's Boris Schlossberg reports on the problems Trichet's comments are causing for the euro in forex trading:

The seeming disagreement with Mr. Weber over the course of European monetary policy created a loss of confidence in the currency market and the unit which has already suffered for most of this week dropped to monthly low of 1.3055. With 1.3000 clearly in their sights euro bears will make every effort to run stops through that level and the latest rumor of a threat by Moody’s to downgrade Ireland will only help them achieve their cause.

Trichet's comments underscore the concerns that many have about the euro zone economy -- that it's not doing as well as leaders keep saying that it is. Hawkish comments have been largely the norm coming out of euro zone leaders and the ECB in recent months. However, admissions that more easing may be needed serve to provide forex traders with indications that the euro zone economy is a long way from recovery.