The euro fell to its weakest level against the dollar since July2010 on speculation a summit of European Union leaders will provideno new measures to stem the sovereign-debt crisis.

The shared currency extended losses after dropping below 100 yenfor the first time since February and weakening to less than $1.26,price levels where traders who follow technical analysis said sellorders were clustered. The yen climbed at least 0.7 percent versusall its major peers after the Bank of Japan left its asset-purchasefund unchanged.

“Markets are becoming a bit more pessimistic that anythingmaterial will come out of the meetings this evening, and as aconsequence the short-covering rally in the euro was unimpressive,”said Robert Sinche, global head of foreign-exchange strategy at RBSSecurities Inc. in Stamford Connecticut. “Risk appetite and theeuro hitting the lows of the year are emboldening investors.” Ashort is a bet an asset will decline.

The euro fell 0.8 percent to $1.2583 at 11:26 a.m. New Yorktime, after touching $1.2564, the least since July 13, 2010. It was1.6 percent weaker at 99.87 yen, after falling to 99.68, the leastsince Feb. 6. The yen appreciated 0.8 percent to 79.32 perdollar.

Financial turmoil in the euro bloc will come up at tonight'smeeting in Brussels only “at the very end,” European CouncilPresident Herman Van Rompuy said in a letter before a gathering ofEU officials.

The dollar has gained 4.5 percent over the past month asinvestors sought the safest assets amid a deepening financialcrisis, Bloomberg Correlation-Weighted Indexes show. The yen, thebest performer, added 7.3 percent, while the euro declined 0.5percent, according to the indexes, which track 10 developed-nationcurrencies.

Today's Brussels gathering takes place as Greece prepares tohold new elections on June 17 after an anti-bailout party surged tosecond place in balloting on May 6, boosting speculation that thecountry may exit the currency bloc.

“We know the summit is not going to resolve anything and it willbe hard to find particularly positive headlines,” said NickBennenbroek, head of currency strategy at Wells Fargo & Co. inNew York. “We've seen a lot of the reaction to the meeting has comein the form of anticipation of nothing.”

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