Yesterday the euro fell to the lowest level in more than a week against the yen as Spanish and Italian borrowing costs rose amid concern a European Union summit this week will fail to solve the sovereign-debt crisis.

Italy sold 2.99 billion euros of zero-coupon notes due in May 2014 at a yield of 4.71 percent, more than the 4.04 percent paid on May 28. Spain auctioned 3.08 billion euros of bills, with three-month securities yielding 2.36 percent, compared with 0.85 percent at the previous auction.

Moody’s Investors Service downgraded 28 Spanish banks yesterday, citing the country’s sovereign debt and rising real estate losses.

The 17-nation currency slid against the dollar, reaching its lowest point since June 8, after German Chancellor Angela Merkel was quoted saying she expects no shared debt liability in her lifetime.

The greenback weakened against the yen after a report showed that U.S. consumer confidence fell for a fourth month in June, reaching a five-month low. Japan’s currency strengthened versus most of its major peers on haven appeal.