Euro (EUR) Pushes Up Against Dollar (USD) As Greece Fears Ease
The European single currency rose slightly against the dollar on Tuesday as the foreign exchange market tracked, easing tensions surrounding the Greek debt crisis, dealers said.
In morning London trade, the single currency increased to 1.3937 dollars from 1.3931 dollars in New York late Monday.
Greece's plans to tackle its debt mountain are achievable but the risks involved could require more measures, a European commissioner said Monday, ahead of an EU report on the crisis budget.
The Greek stability programme "has established ambitious targets which are achievable" but "surrounded by risks," EU Economic Affairs Commissioner Joaquin Almunia said before Wednesday's report.
Almunia's comments eased pressure on Greek sovereign bonds, whose yields fell late Monday after reaching record highs last week.
The turmoil in Greece has meant that the country must pay substantially more than many of its eurozone partners to attract investors to buy its debt.
"For a third consecutive day, Greek government bonds have performed better, narrowing the yield spread... and easing concerns over the euro," said Jane Foley, an analyst at online trading group Forex.com.
"Without doubt EMU (European Monetary Union) faces further significant hurdles this year in view of the budget problems of Greece, Spain and Portugal."
In Athens, Greek Prime Minister George Papandreou vowed Monday to do "everything necessary" to pull the eurozone member out of a fiscal hole that has hurt its standing on the financial markets.
He has outlined sweeping public sector cuts to bring Greece's deficit into line with eurozone requirements by 2013.
These proposals include major curbs on public sector hiring and pay, a 10-percent cut in social security and "a significant reduction in military expenditures."
Greece is struggling under a massive debt of more than 294 billion euros (412 billion dollars), a runaway public deficit estimated at 12.7 percent of output, a triple downgrade of its sovereign debt ratings and doubts over data.
In London on Tuesday, the euro was changing hands at 1.3937 dollars against 1.3931 dollars late on Monday, at 126.38 yen (126.21), 0.8752 pounds (0.8728) and 1.4731 Swiss francs (1.4711).
