Euro continues struggle as Spanish troubles mount

The value of the shared currency of the European Union dropped on Tuesday to its lowest level against the U.S. dollar in one week, according to Bloomberg.

Tugging down the embattled monetary unit was borrowing costs climbing higher on Spanish and Italian debt auctions. Pessimism grew about the likelihood of Thursday and Friday's summit in Brussels resolving the sovereign debt crisis.

"The euro weakness today is a reflection of the ongoing loss of investor confidence in European policy makers to deal with the crisis effectively," foreign-exchange strategist Lee Hardman with Bank of Tokyo-Mitsubishi UFJ in London told Bloomberg. "Unfortunately it still appears likely that conditions will have to get a lot worse before they prompt a more decisive policy response."

The euro lost 1.5 percent of its value on Monday, which represents its largest fall since the end of last month. Thus far this year, the euro {currency} has lost roughly 3.6 percent of its value against the U.S. dollar.

Short-term borrowing expenses in Spain nearly tripled on Tuesday, Reuters reports. Moody's slashed the credit rating of 28 Spanish banks, underscoring the dire straits that the nation presently finds itself in.