The euro declined for a second day before a report forecast to show German investor confidence fell to a three-year low as Europe's debt crisis threatens to curb economic growth.

The 17-nation currency touched a one-month low against the yen as Spain prepares to sell as much as 4 billion euros ($5.4 billion) of bonds on Nov. 17 after Italy's borrowing costs surged to the highest level since 1997 at a note auction. Japan's currency slid almost half a yen against the dollar in less than a minute before paring losses amid speculation the nation will act to weaken its currency to support exporters.

"In the short term you must be bearish euro given that the sovereign-debt crisis hasn't been contained," said Besa Deda, chief economist at St. George Bank Ltd. in Sydney.

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