LONDON, May 18 (Reuters) - The euro fell on Friday to hit a four-month low against the dollar and a 3-1/2 month trough versus the yen as concerns about a chaotic Greek exit from the euro zone, banking sector worries and contagion risks drove investors to add to bearish positions.
The euro fell to $1.2642, close to its 2012 low of $1.2624. A drop below that level will take the single currency to its lowest since August 2010. The euro also fell to a 3-1/2 month low against the yen to 100.219.
The safe-haven dollar rose with the dollar index rising to a four month high of 81.758. The greenback also rose to a four-month peak against the Swiss franc of 0.95002 francs on trading platform EBS.
The high-yielding Australian dollar extended losses, tracking sharp drops in stock markets, to drop to its lowest level in nearly six months of $0.9794.