Forex - EUR/USD remains lower after S&P warn on Greek rollover
Investing.com
Published Jul 04, 2011 10:02AM ET
EUR/USD hit 1.4497 during European late afternoon trade, the daily low; the pair subsequently consolidated at 1.4515, slipping 0.05%.
The pair was likely to find support at 1.4426, last Thursday’s low and short-term resistance at 1.4577, the days high and a one-month high.
French lenders have proposed a plan to reinvest half of the proceeds from maturing Greek government bonds into new 30-year Greek bonds. The European Central Bank said that it supported the plan, as long as it was voluntary.
Earlier Monday, S&P said the proposal would “likely amount to a default under our criteria."
Over the weekend, euro zone finance ministers approved the next EUR12 billion installment of Greece's bailout but warned that the indebted nation must expect significant losses of sovereignty and jobs.
But the shared currency remained supported by expectations that the ECB will lift interest rates at its monthly policy meeting on Thursday, after bank head Jean-Claude Trichet said last week the ECB was in “strong vigilance mode.”
The euro was also lower against the pound, with EUR/GBP dipping 0.06% to hit 0.9029.
Also Monday, official data showed that producer price inflation in the euro zone declined slightly more than expected in May, on the back of cheaper oil prices.
Eurostat said that PPI declined by 0.2%, after rising by 0.9% in April. Analysts had expected the producer price index to decline by 0.1% in May.
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Written By: Investing.com
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