The Euro extended its decline against the US Dollar overnight, breaching 1.31 and pushing down to 1.3060. In November alone EURUSD has seen a range of over 12 cents – with a high of 1.4280 reached when the US Federal Reserve made their announcement about their second round of quantitative easing, but since then the pair has since lost 8.5% since 3^rd November.

There’s been two main reasons behind the decline in EURUSD – European sovereign debt issues undermining investors confidence in the European currency; and a flight to safety in light of escalating tensions in Korea. Indeed on this last point, yesterday the South Korean President said that North Korea will pay the price if there were more provocations. The markets didn’t react well to this, especially on the knowledge that North Korea has a secretive leader with nuclear weapons at their disposal.

The Australian Dollar fared badly in the nervous sentiment, reaching a low of 0.9565. AUDUSD has also seen a bumpy month in November – it reached a near 30 year high of 1.0182 against the Greenback on November 5^th but has since lost over 6% in the last 3 weeks. This week’s GDP news release for the preceding quarter, which is forecasted to show a softer rate of growth, may pose more downside risk.