Euro slips vs dollar on Greek jitters; Dollar higher despite Friday's data

Euro slips vs dollar on Greek jitters; Dollar higher despite Friday's data

1 June 2015, 09:01
News
0
671

On Monday the euro edged lower against the dollar as ongoing concerns over the prospect of a Greek debt default weighed, while the greenback was steady near its highs against the yen.

EUR/USD was down 0.46% to 1.0938 from 1.0987 late Friday.

At the end of this week, Greece is due to make a €305 million payment to the International Monetary Fund. However, fears over a possible default mounted, since Athens warned in the last weeks that it will be unable to make the repayment if a cash-for-reforms deal with its international lenders was not reached by then.

Greece and its European creditors agreed on the need to reach a cash-for-reforms deal quickly as Athens missed a self-imposed Sunday deadline for reaching an agreement to unlock aid, Reuters reported.

The dollar was hardly impacted by Friday's data showing that the U.S. economy contracted in the first quarter, as recent indications of a rebound in growth continued to support expectations for higher interest rates.

The U.S. Commerce Department said that gross domestic product contracted at an annual rate of 0.7% in the first quarter of the year, instead of the initial estimate of 0.2% growth.

That was slightly better than economists' expectations for a drop of 0.8 percent, but still underscored the fact that the recovery stalled early this year, and the Federal Reserve policymakers might wait longer to raise U.S. interest rates until they have more confidence in the economy's momentum.

On Friday, Wall Street's major indexes posted monthly gains but daily losses after the University of Michigan's consumer sentiment marked a drop, while the Institute for Supply Management-Chicago Business Barometer unexpectedly fell.

The figures weighed on U.S. Treasury yields, curbing the greenback's recent rally against the yen. It stood at 124.20 in early trading, nearly flat on the day and below its more than 12-year peak of 124.46 yen scaled last week.

Share it with friends: