TOKYO: The euro fell against other major currencies in Asia on Friday after Standard & Poor's downgraded Spain's credit rating by a notch in the latest reminder of the scope of the eurozone's debt problems.
The euro bought $1.3737 and 105.66 yen in Tokyo morning trade, down from $1.3783 and 105.92 yen in New York late Thursday.
The dollar edged up to 76.92 yen from 76.85.
Major ratings agency Standard & Poor's cut Spain to "AA-" from "AA" with a negative outlook on Thursday, following downgrades to the country's top banks on Tuesday.
S&P said high unemployment, tighter financial conditions and "the likely economic slowdown in Spain's main trading partners" prompted the downgrade.
Dealers and analysts said the euro's losses were limited as the S&P move closely followed Fitch Ratings' downgrade of Spain by two notches to double A-minus last week.
"Such a downgrade was already expected," said Koji Fukaya, director of fixed income and global foreign exchange research at Credit Suisse.
"Now the market is looking toward expected capital injections by governments in the eurozone, which would be supportive for the euro," he said.
Still, Fukaya and other observers warned there was little room for optimism.
The euro will likely remain stuck in a $1.3500-$1.4000 range in the coming weeks as investors remain hesitant to buy the unit amid talk of bigger losses for private investors holding Greek debt, Fukaya said.
Ahead of a meeting of Group of 20 finance ministers and central bank chiefs in Paris this weekend, dealers said they would be watching for any developments on plans to deal with the European debt problems and their fallout.
Singapore's central bank on Friday eased monetary policy for the first time in over two years, a move that followed a surprise rate cut by the Indonesian central bank this week.
The Singapore dollar rose following the rate cut. The US currency was at S$1.2737, down from around S$1.2781 before the announcement.
Analysts say such moves by Asian central banks underline concerns that deepening debt and economic problems in the West could severely hurt growth in many of Asia's export-dependent economies.
On Thursday the IMF warned in a report that Asia faces "downside" risks due to fallout from the eurozone debt crisis and a slowing US economy.
"There is 'no place to hide' when advanced markets come under pressure," it said.
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