BlackRock's Larry Fink predicts euro will fall to $1.20 (0.76p)

The boss of the world’s largest money manager predicts that the euro, which has been hit by fears that Ireland's financial woes could spread to Portugal and Spain, will fall 10pc to $1.20 against the dollar.

Mr Fink told the Financial Times: “The fundamental problem is most European sovereign credit is owned by the banking system. The banking system was supported by the regulators’ credit ratings of sovereign credit, so you could have bought Ireland and it had the same credit rating as Germany at one time ... that policy was clearly wrong.”

On the huge amounts of government debt that European banks now hold, he added: “You have something that was freely understood and traded and people invested in it, to something that nobody wants.” Read more