* Euro hit by reported Greek comments
* U.S. jobless claims fall; inflation contained
* Risk demand dwindles, high-risk FX edge lower (Adds comment, U.S. data, updates prices, changes byline,dateline; previous LONDON)
By Gertrude Chavez-Dreyfuss
NEW YORK, March 18 (Reuters) - The euro weakened againstthe dollar on Thursday as a published report saying Greece wasnot optimistic about receiving aid from euro zone membersheightened uncertainty over a resolution to its debt problems.
An unidentified Greek official quoted in the report saidGreece was increasingly pessimistic about the prospect forassistance at a March 25 European Union summit and may seekInternational Monetary Fund aid during the April 2-4 Easterweekend.
"We have seen some euro weakness just on the uncertaintyover who will aid Greece. It seems that Greece could leantoward the IMF and this has spurred a little bit of riskaversion," said Camilla Sutton, senior currency strategist atScotia Capital in Toronto.
Greece, battling with crippling debts, has said it iscounting on EU leaders to approve a mechanism to help thecountry at next week"s meeting.
But some countries -- especially Germany, the EU"s biggestpaymaster -- are wary of making concrete promises and analystssaid the Dow Jones Newswires report suggested a rift betweenGreece and Germany may be deepening. For more see[ID:nSGE62H08W].
Comments from German Chancellor Angela Merkel saying onWednesday the Greek crisis had landed the euro with its biggestchallenge were also putting selling pressure on the euro zonesingle currency. [ID:nLDE62G16Q]
In early New York trading, the euro EUR= was down around0.4 percent on the day at $1.3678, pulling back from afive-week high hit on Wednesday.
"It"s noteworthy that we"re still in yesterday"s ranges andeven the euro has bounced off its lows. We have seen itstabilize and the euro is now trading within a band," Scotia"sSutton said.
The euro struggled as European shares .FTEU3 retreatedfrom a 17-month closing high hit on Wednesday, while prices foroil CLC1, another risky asset, fell 0.5 percent on the day.
The euro hit the day"s low at $1.3648 in early Europeantrade, but losses were limited due to suspected demand fromAsian central banks around that level, traders said, whiletrendline support around $1.3640 also prevented more losses.
The dollar rose 0.46 percent against a basket of currenciesto 80.005 .DXY. The greenback slipped 0.2 percent to 90.13yen JPY= as the Japanese currency benefited from riskaversion, pushing the euro EURJPY=R down 0.5 percent to123.35 yen.
Data showing a fall in the latest U.S. weekly joblessclaims data and that U.S. inflation was contained spurredmodest dollar selling on slightly higher risk appetite, butoverall markets was cautious and focused on Greece.
"The jobless claims number shows the labor market continuesto stabilize, however there is very little if any pricepressure in the U.S. which would allow the Fed to leaveinterest rates low for some time," said John Doyle, foreignexchange strategist at Tempus Consulting in Washington.
"It is a very dollar muted reaction so far and the dollarwill continue to trade on fears the Greek bailout plan may beunraveling."
Against the Canadian dollar CAD=D4 the U.S. dollar pulledback from a 20-month low of C$1.0071 on Wednesday to trade atC$1.0101 but analysts see the pair hitting parity in the nearterm on speculation that Canadian interest rates may soonrise. (Additional reporting by Neal Armstrong in London and NickOlivari in New York; Editing by James Dalgleish)
Currencies
No comments:
Post a Comment