Oost-Europese beurzen staan onder druk (en)
Eastern European currencies and stock markets tumbled on Tuesday while the euro slid to a three-month low against the dollar, as ratings agencies warned of the threat to western banks from the parlous state of economies in the east.
The euro fell more than two US cents to a two-month low. The German and French stock markets each declined three percent.
Shares in western European banks with heavy eastern exposure skidded, with Austria's Raiffeisen and Este Bank, France's Societe Generale, Italy's Unicredit and Belgium's KBC falling hardest.
However, the wobbles in the west were little compared to the steep drops seen in new EU member states, neighbourhood countries and Russia.
The Bucharest stock exchange fell 8.6 percent. Prague's BCPP bourse sank to a five-year low, down 7.6 percent, while its PX stock index drooped 6.8 percent. Poland's WIG20 index tumbled 7.5 percent.
More lightly hit were Hungary's BUX index, down 2.4 percent and the Bulgarian Sofix index, down 2.1 percent.
Russia's RTS and Micex indices, however, both fell 9.4 percent.
Currencies too took a beating, with the Polish zloty cascading to a five-year low against the euro, and the Czech koruna stumbling to a three-year low. Hungary's forint dove to a record low.
The carnage was provoked by a pair of reports from major ratings agencies Moody's Investors Service and Standard & Poor's saying the situation in the east is grim.
Moody's warned that western European banks with significant exposure via local subsidaries in the former Communist nations could see their ratings downgraded.
"Deteriorating financial strength of East European subsidiaries has a negative spillover effect on their West European parents," said the agency.
Countries in particularly dire straits, according to Moody's, were Bulgaria, Croatia, Hungary, Romania and the Baltic nations.
Standard & Poor's issued a similar call on Tuesday, threatening to review the ratings of eastern banks.
Separately, a report from Danske Bank concluded: "No currency in the region will be unaffected."
The reports come on the heels of a fresh warning from IMF chief Dominique Strauss-Kahn on the weekend, who said he foresaw a "second wave" of countries who would come knocking on his door for bail-outs.
The IMF is already engaged in assistance programmes in Belarus, Ukraine, Hungary, and Latvia.
In Romania on Monday, Prime Minister Emil Boc said at some point over the next fortnight he would decide whether to approach the IMF or the EU.