Euro Weaker in Asia Amid Economic Gloom

The euro weakened in Asia on Wednesday as traders sold the unit over fears about the eurozone's fiscal woes and a gloomy world economic outlook from the International Monetary Fund.

The European common currency was changing hands at $1.2859 in Tokyo afternoon trade against $1.2881 in New York late Tuesday, while it edged down to 100.58 yen from 100.77 yen.

The dollar bought 78.20 yen, against 78.23 yen.

Worries about Spain and Greece's finances weighed on markets as European Union finance ministers met in Luxembourg while German Chancellor Angela Merkel went to Athens for talks on Tuesday.

The IMF added to concerns about the global economy, warning of a possible recession and cutting back its world economic growth forecast for this year to 3.3 percent, from its July estimate of 3.5 percent.

In a separate report, released Wednesday, the IMF said European policymakers must do more to tackle a fiscal crisis that is heaping extra pressure on an already-strained global financial system.

Markets largely shrugged off the no-show of Chinese central bank governor Zhou Xiaochuan and Finance Minister Xie Xuren at the IMF annual meetings in Tokyo this week as Tokyo and Beijing clash over a chain of islands in the East China Sea.

Deputy governor Yi Gang will take Zhou's place at the summit and deliver the summit's closing lecture.

The move comes after several private Chinese banks were reported to be limiting or canceling their participation in events linked to the meetings, which began on Tuesday and will run until Sunday.

The U.S. dollar was higher against other Asia-Pacific currencies, rising to 52.88 Indian rupees from 52.43 rupees on Tuesday and to 9,610 Indonesian rupiah from 9,597 rupiah.

It firmed to 41.54 Philippine pesos from 41.39 pesos, to 30.72 Thai baht from 30.62 baht and to Sg$1.2300 from Sg$1.2283.

The greenback also gained to 1,114.15 South Korean won from 1,111.05 won and to Tw$29.32 from Tw$29.29.

The Australian dollar was at $1.0224 against $1.0229 a day earlier, while China's yuan changed hands at 12.40 yen against 12.47 yen.